Decomposing Medical-Care Expenditure Growth

Abe Dunn, Eli Liebman and Adam Shapiro

No 2012-26, Working Paper Series from Federal Reserve Bank of San Francisco

Abstract: Medical-care expenditures have been rising rapidly, accounting for almost one-fifth of GDP in 2009. In this study, we assess the sources of the rising medical-care expenditures in the commercial sector. We employ a novel framework for decomposing expenditure growth into four components at the disease level: service price growth, service utilization growth, treated disease prevalence growth, and demographic shift. The decomposition shows that growth in prices and treated prevalence are the primary drivers of medical-care expenditure growth over the 2003 to 2007 period. There was no growth in service utilization at the aggregate level over this period. Price and utilization growth were especially large for the treatment of malignant neoplasms. For many conditions, treated prevalence has shifted towards preventive treatment and away from treatment for late-stage illnesses.

Pages: 31 pages
Date: 2012-11-20
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
https://www.frbsf.org/economic-research/files/wp12-26bk.pdf Full text (application/pdf)

Related works:
Working Paper: Decomposing Medical-Care Expenditure Growth (2017)
Chapter: Decomposing Medical Care Expenditure Growth (2016)
Working Paper: Decomposing Medical-Care Expenditure Growth (2012)
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: https://EconPapers.repec.org/RePEc:fip:fedfwp:2012-26

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Working Paper Series from Federal Reserve Bank of San Francisco Contact information at EDIRC.
Bibliographic data for series maintained by Federal Reserve Bank of San Francisco Research Library ().