The Effects of Drug Subsidies on Out-of Pocket Prescription Drug Expenditures by Seniors: Regional Evidence from Canada

Thomas Crossley (tfcross@umich.edu), Paul Grootendorst, Sule Korkmaz and Michael Veall

Quantitative Studies in Economics and Population Research Reports from McMaster University

Abstract: Between 1970 and 1986 all Canadian provinces introduced some version of a prescription drug subsidy for those age 65 or over and since 1986, all the provinces have increased copayments or deductibles to some degree. Employing a first-order approximation to the welfare gains from a subsidy, we find evidence that these subsidies have been less redistributive than an absolute per household cash transfer but slightly more redistributive than a transfer that would increase each household's income by the same percentage. Such evidence may have relevance for predicting the redistributive effects of a potential national prescription drug plan for seniors in the United States.

Keywords: Prescription drug subsidies; Incidence; Redistribution; Progressivity (search for similar items in EconPapers)
JEL-codes: H23 I18 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2000-04
New Economics Papers: this item is included in nep-hea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: The effects of drug subsidies on out-of-pocket prescription drug expenditures by seniors: regional evidence from Canada (2002)
Working Paper: The Effects of Drug Subsidies on Out-of-Poket Prescription Drug Expenditures by seniors: regional Evidence from Canada (2000)
Working Paper: The Effects of Drug Subsidies on Out-of Pocket Prescription Drug Expenditures by Seniors: Regional Evidence from Canada (2000)
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