ANALYSIS OF FACTORS INFLUENCING INDIVIDUAL’S WILLINGNESS TO PAY FOR THE COMPULSORY SOCIAL HEALTH INSURANCE SCHEME: THE CASE OF GOVERNMENT SCHOOL TEACHERS IN KOLFE KERANIYO SUBCITY

Abstract

Improvements in health closely follow improvements in education as a contributing factor to development and economic growth. Better health in the population will enable workers to put forward greater effort and maintain their efficiency for longer periods. In order to keep citizens healthy and good workforces, many countries in the world have health care financing through social health compulsory and voluntary health insurance systems. But, people must be motivated and have the incentive to accept and pay for Social Health Insurance (SHI) even in compulsory systems. This study analyzed the factors influencing formal sector workers‟ willingness to pay (WTP) for the Ethiopian compulsory Social Health Insurance (SHI) scheme (3% payroll), among Addis Ababa government Elementary and Secondary School teachers. Data were collected from 294 respondents using the multi-stage sampling procedures. Data were analyzed with descriptive statistics and Logistic Regression. General results showed that majority of the respondents, 65 percent were not willing to pay the 3% payroll of the SHI scheme set by the government. Factors like, age, sex, income, awareness and experiences of individuals‟ out of pocket expense during sudden sickness have been analyzed with the dependent variables willingness to pay the compulsory contribution of the SHI scheme. The Logistic regression results showed that respondents with age group 20-30 are more likely willingness to pay as compared to age group 30-40,40-50 and above. Respondents with salary 3000-5000 are less likely to pay as compared those with salary 5000-8000. Those who have information about SHI are less likely to be willing to pay as a compared to those who have no information about SHI and those who said SHI has value were more likely to be willing to pay as compared to those who never said about SHI has value. To the questions why respondents were not willingness to pay, the following reasons were suggested and these include: low income/salary, preferred that government subsidize all civil servants, and claimed that they do not have trust on the management and service delivered from health facilities. Also this study showed significant number of females were willing to pay compared to males.