Health Care Reform: Separating Insurance from Income Redistribution

Friedrich Breyer and Andreas Haufler

No 205, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: Most systems of health care financing in EU member states currently include elements of income redistribution. The paper analyzes the effects of shifting this kind of redistribution to the tax system and argues that this reform could create two types of efficiency gains. On the expenditure side, it would facilitate the adoption of more incentive-compatible insurance contracts, for example through the introduction of copayment schemes. On the revenue side, income redistribution through the general tax system is likely to imply a shadow price of public funds that is lower than if redistribution is carried out through wage-based insurance contributions.

Keywords: health care finance; income redistribution (search for similar items in EconPapers)
JEL-codes: H51 I18 (search for similar items in EconPapers)
Pages: 24 p.
Date: 2000
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Citations: View citations in EconPapers (37)

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Related works:
Journal Article: Health Care Reform: Separating Insurance from Income Redistribution (2000)
Working Paper: Health Care Reform: Separating Insurance from Income Redistribution (2000)
Working Paper: Health care reform: Separating insurance from income redistribution (1999)
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