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Understanding consumer preferences in the context of managed competition

Evidence from a choice experiment in Colombia

Applied Health Economics and Health Policy volume 10, pages 99–111 (2012)Cite this article

Abstract

Background

In many countries, health insurance coverage is the primary way for individuals to access care. Governments can support access through social insurance programmes; however, after a certain period, governments struggle to achieve universal coverage. Evidence suggests that complex individual behaviour may play a role.

Objectives

Using a choice experiment, this research explored consumer preferences for health insurance in Colombia. We also evaluated whether preferences differed across consumers with differing demographic and health status factors.

Methods

A household field experiment was conducted in Bogotá in 2010. The sample consisted of 109 uninsured and 133 low-income insured individuals. Each individual evaluated 12 pair-wise comparisons of hypothetical health plans. We focused on six characteristics of health insurance: premium, out-of-pocket expenditure, chronic condition coverage, quality of care, family coverage and sick leave. A main effects orthogonal design was used to derive the 72 scenarios used in the choice experiment. Parameters were estimated using conditional logit models. Since price data were included, we estimated respondents’ willingness to pay for characteristics.

Results

Consumers valued health benefits and family coverage more than other attributes. Additionally, differences in preferences can be exploited to increase coverage. The willingness to pay for benefits may partially cover the average cost of providing them.

Conclusion

Policy makers might be able to encourage those insured via the subsidized system to enrol in the next level of the social health insurance scheme through expanding benefits to family members and expanding the level of chronic condition coverage.

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Notes

  1. For a detailed description of the two tiers, please see table S1 in the Supplemental Digital Content (SDC), http://links.adisonline.com/APZ/A47.

  2. For a more in-depth description, please see table S1 in the SDC.

  3. For public policy purposes (e.g. calculation of subsidies in public services, welfare programme aids, property taxes, etc.), geographic areas in Bogota are classified in stratum based on a scale from 1=poorest to 6=richest.

  4. We feel that these populations are different and need to be estimated separately. However, we tried the analysis with the pooled sample and the results were similar.

  5. For the analysis of the heterogeneity, we considered taking all the four variables in one specification, but most of the interactions were not significant and were hard to interpret. As such, we decided to run separate regressions.

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Acknowledgements

This project was financed by Asocajas, Fundación Corona and Gestar Salud as a part of the project “New Strategies for Health Universalization in Colombia”. The authors have no conflicts of interest that are directly relevant to the content of this article.

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Affiliations

  1. Department of International Health, Health Systems, Johns Hopkins Bloomberg School of Public Health, Suite E8142, 615 North Wolfe St., Baltimore, Maryland, 21205, USA

    Antonio J. Trujillo, John F. P. Bridges & Christine Buttorff

  2. Cendex, Pontificia Universidad Javeriana, Bogotá, Colombia

    Fernando Ruiz, Jeannette L. Amaya & Angélica M. Quiroga

Authors
  1. Antonio J. Trujillo
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  2. Fernando Ruiz
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  3. John F. P. Bridges
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  4. Jeannette L. Amaya
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  6. Angélica M. Quiroga
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Correspondence to Antonio J. Trujillo.

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Trujillo, A.J., Ruiz, F., Bridges, J.F.P. et al. Understanding consumer preferences in the context of managed competition. Appl Health Econ Health Policy 10, 99–111 (2012). https://doi.org/10.2165/11594820-000000000-00000

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Keywords

  • Sick Leave
  • Health Insurance Coverage
  • Discrete Choice Experiment
  • Supplemental Digital Content
  • Conditional Logit Model