Effects of private health insurance on medical expenditure and health service utilization in South Korea: a quantile regression analysis

Abstract

Background Despite universal health insurance, South Korea has seen a sharp increase in the number of people enrolled in supplemental private health insurance (PHI) during the last decade. This study examined how private health insurance enrollment affects medical expenditure and health service utilization. Methods Unbalanced panel data for adults aged 19 and older were constructed using the 2016–2018 Korea Health Panel Survey. Quantile regression for medical cost, and quantile count regression for health service utilization were utilized using propensity score-matched data. We included 17 variables representing demographic, socioeconomic, and health information, as well as medical costs and use of outpatient and inpatient care. Results We discovered that PHI enrollees’ socioeconomic and health status is more likely to be better than PHI non-enrollees’. Results showed that private health insurance had a greater effect on the lower quantiles of the conditional distribution of outpatient costs (coefficient 0.149 at the 10th quantile and 0.121 at the 25th quantile) and higher quantiles of inpaitent care utilization (coefficient 0.321 at the 90th quantile for days of hospitalization and 0.076 at the 90th quantile for number of inpatient visits). Conclusions PHI enrollment is positively correlated with outpatient costs and inpatient care utilization. Government policies should consider these heterogeneous distributional effects of private health insurance.

Disparities in cause-specific mortality by health insurance type and premium: evidence from Korean NHIS-HEALS cohort study, 2002–2019

“…Previous Korean studies have shown that the SI group has lower outpatient medical utilization and higher unmet medical needs compared to the EI group [ 7 ]. Conversely, previous studies have shown that having private insurance in addition to the NHIS is associated with increased outpatient costs, inpatient utilization, and lower mortality, particularly among high-income individuals who are more likely to have private insurance [ 27 , 28 ]. According to these results, since Korea’s NHI covers only 64.5% of the total medical expenses (as of 2021), those with private insurance or high incomes may have access to expensive treatments, procedures, and preventive screenings not covered by public insurance, potentially lowering their mortality risk [ 29 ].…”