Factors Influencing Basic and Complementary Health Insurance Purchasing Decisions in Iran: Analysis of Data From a National Survey

Date01 June 2016
Published date01 June 2016
DOIhttp://doi.org/10.1002/wmh3.187
Factors Inf‌luencing Basic and Complementary Health
Insurance Purchasing Decisions in Iran: Analysis of
Data From a National Survey
Shirin Nosratnejad, Arash Rashidian, Mohsen Mehrara, Nahid Jafari,
Maryam Moeeni, and Hassan Babamohamadi
Expanding the coverage of health-care insurance is a tool toward achieving universal health coverage
and reducing f‌inancial barriers to care. Therefore, understanding the factors that affect the expansion
of health insurance is important for policymakers. The study aimed at assessing the variables that
affected the decisions to purchase health insurance in Iran. We analyzed data gathered from a national
survey of health-care utilization in Iran that covered over 23,000 households. We identif‌ied subsets of
the data that represented purchasing decisions. Increase in age, education, income, wealth, and the
opportunity of working in the governmental sector increased the probability of purchasing BHI and
CHI coverage. Past utilization of inpatient and outpatient care increased the probability of purchasing
BHI and CHI, respectively. Evidence of adverse selection and wide socioeconomic differences in
insurance purchase decisions were observed throughout the study. However, most signif‌icant factors
were not easily inf‌luenced by policy decisions. The f‌indings suggest that it might be very diff‌icult to
achieve universal insurance coverage unless nation-wide nonvoluntary policies are implemented.
KEY WORDS: basic health insurance, complementary health insurance, Iran, national survey
Introduction
Expanding social protection for health care to include the whole population
of a nation is an important international goal (Mathauer, Schmidt, & Wenyaa,
2008; Preker & Carrin, 2004). Such schemes are required to reduce f‌inancial
barriers to access health care and avoid the catastrophic expenditures as a result
of health-care utilization (Mathauer et al., 2008).
Many low- and middle-income countries have achieved social or basic health
insurance (BHI) coverage for formal sector employees (Preker, Lindner, Cherni-
chovsky, & Schellekens, 2013). It is less challenging to cover the formal sector as
they are more organized, they have stable incomes, and it is possible to reduce
insurance premiums from their payroll (Nguyen & Knowles, 2010). On the
contrary, expanding the coverage for other groups (informal employees) remains
diff‌icult in low- and middle-income countries as well as high-income countries
World Medical & Health Policy, Vol. 8, No. 2, 2016
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1948-4682 #2016 Policy Studies Organization
Published by Wiley Periodicals, Inc., 350 Main Street, Malden, MA 02148, USA, and 9600 Garsington Road, Oxford, OX4 2DQ.
with nonmandatory social protection policies (Mathauer et al., 2008; Savedoff, de
Ferranti, Smith, & Fan, 2012). The general characteristics of the informal sector
and the self-employed, e.g., nonregularity of income along with unknown
affordability status, negatively affects the ability of the insurance organization to
collect premiums. Moreover, the negative effect can inf‌luence the state to provide
means-tested social protection for low-income households.
Among the policies that may improve universal coverage via social insurance
is to enhance the demand for social insurance and its acceptability among a
nation’s population. For this purpose, policymakers need to understand the factors
that affect demand among informal and self-employed sectors. Literature examin-
ing factors that affect such demand is limited in low/middle-income countries and
the studies have focused on assessing the factors that inf‌luence the willingness to
pay of individuals or households for health insurance.
Within the last 30 years Iran has aspired to reach universal health coverage.
While the country enjoys a universal provision of access to basic primary health-
care packages (Ibrahimipour et al., 2011), f‌inancial barriers negatively affect access
to many ambulatory treatment and diagnostic services and inpatient care. In
1994, Iran’s Parliament legislated the Universal Health Insurance Law which
resulted in many benef‌icial consequences. However, despite the achievements in
2010, 16.8 percent of the population were not covered by health-care insurance
(Rashidian et al., 2012) and in 2009 about 50 percent of the total health care
expenditure was paid by households as an out of pocket expenditure (Manenti,
2011; Takian, Rashidian, & Kabir, 2010).
In Iran, basic health insurance (BHI) is delivered by governmental or semi-
public organizations that cover the majority of the households in the country.
Moreover, in recent years, complementary health insurance (CHI) services were
delivered by private companies (an estimated coverage of 12.5 percent in 2010
[Rashidian et al., 2012]).
The current study is based on the data taken from a national survey of
health-care utilization at the household level. The study aimed at assessing the
variables that inf‌luenced the effective demands or decisions for purchasing BHI
and CHI in Iran.
Health-Care Insurance in Iran
Iran is a middle-income country with a population of over 75 million (based
on the national census of 2012), which annually devotes 6–7 percent of its GDP to
health and treatment services (WHO, 2013). The health services of the country are
generally divided into two categories of primary health care (PHC) and treatment
services (Ibrahimipour et al., 2011).
The PHC is almost fully f‌inanced by the government and aims at delivering
services such as public health, immunizations, mother and child health, and
limited services for chronic disease management. It also includes an expanding
program of family physician service. Most of these services are delivered free of
charge or incur small fees and are offered to all legal residents of the country. The
180 World Medical & Health Policy, 8:2

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