Steps to reduce the deficit of health insurance: Colombia and the US

Regulation of health insurance is one of the most complex challenges to contemporary states. We have two pieces on systems that have been more researched, on on North America, one on Latin America. On Colombia, David Bardey y Marcela Melendez announce the end of the setup defined since 1994 due to its inability to control expenditures. They wonder if the adjustments are eliminating desirable features of the 1994 reform. On the US, Becker and Posner point out that facilitating the work of those over 60-years of age can reduce the deficit of Medicare in a fair amount.

Health Reforms in the Americas

The CISS Health Systems and Insurance Report 2006-2010 – Health Reforms in the Americas is now available online.

Is higher investment decreasing the unemployment rate in America?

John Taylor states high investment is the most effective way to reduce unemployment (click here to see the graph). The following graphs show the same variables with data for all countries in the Americas from 1980 to 2008. Lower unemployment lead by a greater investment-GDP ratio is not observed in all regions of the continent, which could be explained, in Mexico for example, by structural change – less people are hired due to high investments in technology.

Labor Force Participation Rates in Regions of the World

The following graphs show labor force participation (LFP) rates in different regions of the World. As expected, women in Europe, Japan, and North America have higher rates than in Mexico and the Latin Caribbean, Central America, Korea, and the South Cone between ages 40 to 54. On the contrary, European women stop working at earlier ages and have very low participation rates after retirement ages, followed by Mexico and the Latin Caribbean, 2% and 11.75% respectively, in contrast with 25% in Korea and the Andean Region between ages 70 and 74. European men have the lowest participation rates, followed by North America, between ages 50 and 74. Elderly men have higher participation rates than elderly women, in Mexico and the Latin Caribbean the rate is 45%, and in Central America and the Andean Regions participation rates are higher than 50%.

One million people without social security

There are a million dependent employees in Ecuador not affiliated to the Social Security Institute of Ecuador, according to an interview with President Rafael Correa.

The Value of a Statistical Life

In the United States, regulatory federal agencies are imposing tougher — and more costly — standards. One of the tools to achieve this is by rising the value of a statistical life (VSL). The VLS has always been subject to controversy given the different estimates, and methodologies, used. Read this article in the NYT that describes recent developments in the United States. At the CISS we believe this figure should be used more frequently to regulate many activities that put humans at risk of death. We are convinced the figure in social security can be used to determine pensions related to work injuries, to discriminate among different health interventions, among other examples. The analysis of the VSL is part of our permanent research agenda. In our Annual Report 2010 we present proxies of VSL for all countries of the continent.

Health Systems Efficiency Indexes of the Americas

A new working paper, part of the CISS Health Systems and Insurance Report, has been recently uploaded. This report provides estimates of efficiency indexes using the data envelope analysis (DEA) methodology and Malmquist indexes of health care systems of the countries of the American Continent. Results indicate that the order of the countries regarding their efficiency does not change significantly if we use health spending, socioeconomic and environmental factors or income per capita as inputs. In general rich countries are more efficient than poor countries. Haiti always shows the worst performance and there is evidence that has a lower efficiency, in relative terms today than in 1995. The following figure shows the DEA index calculated using the factors mentioned previously. To access the full text, click here.

Migration and Social Security in America… continued

The Informador and the Nación Dominicana write about the book Migration and Social Security in America, prepared jointly by CIESS, ILO, IOM, and OAS.

Migration and Social Security in America

The Inter-American Center for Social Security Studies (CIESS), the International Labour Organization (ILO), the International Organization for Migration (IOM), and the Organization of American States (OAS) presented on November 24, 2010, through a videoconference, the book Migration and Social Security in America. It aims to reveal the situation of migrants living in America in relation to social security in order to find solutions and develop public policies to facilitate the access to social security. For more information access this link.

Publicly subsidized health insurance: evidence of positive results

There has been a long debate on whether publicly subsidized health insurances for poor populations, which have been implemented in several countries recently, have an effect on health outcomes and out of pocket spending. In this dabate the cases of Medicaid and Seguro Popular have been analyzed with mixed and inconclusive results. Grant Miller, Diana Pinto, and Marcos Vera-Hernández, in an excellent analysis, study the case of Colombia´s “Régimen Subsidiado”. The authors find that the program has indeed protected families against financial risk, increased the use of key preventive services, and improved health outcomes -those linked to preventive services. The authors note that the new more efficient supply-side incentives, a key innovation of the Régimen, have encouraged higher quality and lowered medical care cost, and thus play a critical role in the success of the program. The study won the first prize of the CISS´s Inter-American Award for Research on Social Security 2010.

Efficiency in health care systems…continued

For the second analysis we used 2 variables as inputs, which are physician’s ratio per a population of 10,000 and hospital beds ratio per a population of 1,000; and 2 variables as outputs: i) infant mortality rate and ii) life expectancy in women between 40 and 44 years of age. Likewise, data was obtained for countries in the American Continent and OECD countries, for years 1990 and 2008 (1991 and 2007 in case there was not information available).

Out of the 28 countries analyzed, 15 were more efficient in 2008 than in 1990. Trinidad and Tobago, Belgium, Canada, Chile, Mexico, Netherlands, Paraguay, Austria, Nicaragua, Dominican Republic, Dominica, Peru, and Jamaica registered an index greater than 1. With respect to the efficiency change, the following graph shows that Mexico, Belgium, Portugal, Austria, Netherlands, Peru, Jamaica, and Dominica were better off in 1990 than they were in 2008.

Efficiency in health care systems

We calculated Malmquist Productivity Indices to evaluate the efficiency in health care systems in countries of the American Continent as well as OECD countries. The extent of inefficiency is measured by the deviation of its efficiency parameter value from 1, thus if the score is smaller than 1 it means productivity progress as a country delivers a unit of output in period 2 using less inputs, so the country in period 2 is more efficient relative to itself in period 1. The Malmquist Productivity Index can be decomposed into several efficiency measures, such as efficiency change, change in technology, change in pure efficiency, and change in scale efficiency, amongst others.

We use 6 variables as inputs: i) physician’s ratio per a population of 10,000, ii) hospital beds ratio per a population of 1,000, iii) Gross Domestic Product per capita, iv) primary completion rate, v) proportion of population using improved drinking-water sources, and vi) proportion of population using improved sanitation facilities; and 2 variables as outputs: i) infant mortality rate and ii) life expectancy in women between 40 and 44 years of age. The years used are 1990 and 2008 (1991 and 2007 in case there was not information available). Out of the 14 countries for which the Malmquist was computed, Finland is the one with the smallest index (0.87), whereas Nicaragua is the country with the highest index (1.70), right after Cuba, Belgium, Panama, Trinidad and Tobago, El Salvador, Mexico, Paraguay, and Jamaica. The following graph shows the results:

A new pension in Peru

A new pension aimed for adults over 75 years old and living in extreme poverty has been launched in Peru. The sector benefited by this pension represents 42% of the total population, the majority being women. It is important to mention that only less than 8% of the population over age 60 receives a pension, which explains why many of them continue to work (most of them in the informal sector) at this age. To learn more about this program access this link.

Low coverage in America

According to a new World Bank report, although in most countries of America, cash transfer programs now protect the extreme poor; pensions, unemployment benefits and health insurance fail to provide most workers with protection (especially those in the informal sector). Countries need to focus their attention in increasing coverage of social insurance since more than 50% of the region’s workforce is employed in the informal sector.

J-PAL

The Abdul Latif Jameel Poverty Action Lab (J-PAL) is a network of professors around the World, whose main goal is to ease poverty by guaranteeing that policies are based on scientific evidence. J-PAL accomplishes this by conducting impact evaluations to test and improve the effectiveness of programs and policies; by building capacities: teaching and training on how to carry out said evaluations; and performing cost-effectiveness analysis to identify the most effective ways to reach the policy goals. The J-PAL network has regional offices in Europe, Latin America, and South Asia. In Latin America, the offices were established in 2009 at the Pontificia Universidad Católica de Chile. To learn more about J-PAL access this link.

Old age pension in Venezuela

As of May 1st, in Venezuela, insured women with 55 years and insured men with 60 years, with between 1 and 749 contributions reflected in the Individual Account, which are in an unemployed condition, will have the opportunity to obtain an old-age pension. View more details of the Decree here.

Regulation to health insurance: the rabbit jumped out of the hat

The regualation of mandatory health insurance has become one of the most complex problems for contemporanous States. Just in the last days we have some examples from Mexico, España, Colombia, United States and Canada.

Global crisis: flexibilization of retirement requirements in Peru

Social security has always been the main instrument societies have to face recession, mainly trough unemployment insurance. In our 2010 Annual Report we mentioned the labor market and social security policies implemented in several countries of the continent to face the 2008-2009 global crisis. In Peru since February 2010 men aged 55 and women aged 50 enrolled in the DC pension scheme (we have to remember that in Peru there are two parallel systems -DB and DC-) can ask for early retirement if they have been unemployed for a year (see how the program works here). We have to mention that in Peru there is not unemployment insurance.

Social Security for domestic workers in Spain

According to a BBC World report, the Labour Force Survey indicates that nearly 760,000 Spanish households have domestic workers, being more than half of them immigrants 60% of whom are Latin American. It is expected that in the early months of year 2010, a regulation that requires employers and employees to contribute to Spanish social security from the first hour worked, will come into force. Said legislation discourages oral contracts, establishes a 20-day indemnity per year worked if fired, and provides a working day of 40 hours a week, paying overtime and determining the minimum wage around $900 dollars a month.

Maternity Leave Periods across the Americas

Almost every country in the world warrants maternity leave periods to women so they can spend time with their recent newborns. One of the reasons to grant this benefit is that the first months of the child’s life are crucial for his or her health, cognitive and emotional development. Weeks of paid absence vary across countries from 9 weeks to 18 weeks. As we can see in the graph, the United States is the only country which provides an unpaid maternity leave period (some individual US states and possessions, however, do provide for paid maternity benefits, including Rhode Island, Hawaii, New Jersey, California, New York and Puerto Rico);while Chile, Cuba and Venezuela grant 18 weeks of paid maternity leave period.