Effects of private health insurance on healthcare services during the MERS Pandemic: Evidence from Korea

This study investigates how private health insurance impacted healthcare services during the MERS pandemic in Korea. Using the Korea Health Panel Study (KHPS), this study examines the difference in healthcare utilization between insured and uninsured individuals during the pandemic. If insured individuals use fewer healthcare services than the uninsured during the MERS pandemic, it could be evidence of moral hazard. During the MERS outbreak, the probability of outpatient medical services utilization was lower by 19 % than during non-pandemic periods. All individuals decreased the number of outpatient visits by 7 %. Insured individuals reduced outpatient visits more than the uninsured in response to the MERS pandemic. The increased outpatient utilization by private health insurance could be attributed to both moral hazard and adverse selection. However, given that people with poor health cannot enroll in private health insurance due to the insurance company's screening process, moral hazard leads to increase healthcare utilization rather than adverse selection.