Chapter 2

CEIS Health Report 2006
We have examined the significance of the difference between OOP averages for insured
and uninsured households. The T test for the difference between means has been considered.
The analysis has shown that even where differences have proven the gap to be significant,
it is so low that it cannot be considered economically relevant (table 3).
Table 3 – Differences in effective OOP
mean expenditures between insured and
non-insured households (Italy – 2004)
Standardized Difference between
consumption quintile means
3 rd Quintile € 36
4 th Quintile € 96
5 th Quintile € 48
Source: our elaboration ISTAT data
For instance table 2 shows that an insured household belonging to the fourth standardized
consumption quintile (therefore presumably a well-off household), that had to face
OOP expenditures in 2004, spent €1.836; whereas an uninsured household, with a similar
standardized consumption level (and then presumably with a similar per capita income)
spent an average of €1.932. Comparing the mean expenditures for those households
we can estimate an average OOP difference between insured and non-insured
equal to €96, which is obviously not enough to justify the payment of a premium.
With similar values we can affirm that health insurance does not protect households from
OOP expenditures.
To further verify our findings, we have also resorted to ANOVA-type modelling. The
ANOVA study leads to two main conclusions: we cannot affirm the existence of a linear
link between OOP and insurance and moreover the presence or absence of health insurance
explains a very small part of OOP expenditure variability.
3.8.4 Discussion
These considerations confirm the concept that health insurance does not provide an
effective protection from OOP expenditures. To better explain why such protection is not
provided, a few observations must be made:
1. Data taken into consideration may include insurance that does not provide reimbursement
for healthcare expenditures (daily indemnities, LTC annuity and similar). In fact, Istat
HBS provides information only on expenditure levels without providing any consideration
on what kind of coverage has been purchased. However, those insurance policies
(Borgia, Maruotti and Spandonaro, 2004) represent a very marginal share of the insurance
market, not sufficient to bias our analysis.
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