What can emerging markets learn from a public long-term care insurance system from a mature country: Experimental study?

Weihong Zeng, Chia Ching Chen, Tetsuji Yamada, Joseph Harris, Osama Hamed, Babu N.S. Dasari, I. Ming Chiu, Tadashi Yamada

Research output: Chapter in Book/Report/Conference proceedingChapter

1 Scopus citations

Abstract

In this experimental study, we focus on the issue of welfare policy change in society before and after a public long-term care insurance (LTCI) system. Our experimental study tries to find who benefits the most among different age cohorts by the change in policy. We present a structural model to estimate welfare changes of individuals and to estimate monetary gains for different age groups as well. Using the pooled cross section data of the National Survey on Life Insurance, Japan: Fiscal Year 1997, 2000 and 2003, we find the absolute risk aversion (ARA) of all age groups decreases and their welfare gains are substantial due to the public LTCI change in 2000. We were surprised to find the most beneficiary cohort is the group aged less than 40 years, who is neither subject to the LTCI tax nor generally entitled for the benefits. The experimental results disturb clue of horizontal equity. It reassures that Japanese government would impose LTCI tax on people below age 40 to achieve socio-economic equity and cost/benefit break even.

Original languageEnglish (US)
Title of host publicationHealth Economics and Policy Challenges in Global Emerging Markets
PublisherNova Science Publishers, Inc.
Pages19-40
Number of pages22
ISBN (Electronic)9781634847209
ISBN (Print)9781634847087
StatePublished - Jan 1 2016

All Science Journal Classification (ASJC) codes

  • General Medicine

Keywords

  • Absolute risk aversion (ARA)
  • Long-term care insurance (LTCI)
  • Welfare change

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