Needs-based health care funding: implications for resource distribution in Ontario

Kelly Bedard (), John Dorland, Allan W. Gregory () and Joanne Roberts ()

Canadian Journal of Economics, 2000, vol. 33, issue 4, pages 981-1008

Abstract: Capitation models have been suggested as an alternative to funding methods based on historical utilization patterns. Capitation funding distributes resources to regions or programs according to their population, adjusted for the age and gender composition and relative need. The most commonly used relative needs measure is the Standardized Mortality Ratio (SMR). This paper compares the distribution of resources in Ontario implied by a variety of capitation formula. Another aspect of this research is to design a mechanism that translates the SMR into a funding allocation index. We specify a non-linear model to capture the relationship between current expenditures and the SMR while controlling for historical utilization factors. In contrast to previous work, in which a linear relationship between expenditures and need was assumed, our estimates suggest that the relationship may actually be highly non-linear. This non-linearity increases transfers to regions of relative need relative to a linear capitation program.

JEL-codes: I0 H51 (search for similar items in EconPapers)
Date: 2000
View citations in EconPapers

Downloads: (external link)
http://economics.ca/cgi/xms?jab=v33n4/06.pdf Full text (application/pdf)
Available to subscribers only. Alternative access through JSTOR and Ingenta.

Related works:
Working Paper: Needs-Based Health Care Funding: Implications for Resource Distribution in Ontario
Working Paper: Needs-Based Health Care Funding: Implications for Resource Distribution in Ontario (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cje:issued:v:33:y:2000:i:4:p:981-1008

Ordering information: This journal article can be ordered from
http://economics.ca/en/membership.php

Access Statistics for this article

Canadian Journal of Economics is edited by David Green

More articles in Canadian Journal of Economics from Canadian Economics Association
Address: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
Contact information at EDIRC.
Series data maintained by Prof. Werner Antweiler ().