Health Care Financing, Efficiency, and Equity

Sherry A. Glied

No 13881, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper examines the efficiency and equity implications of alternative health care system financing strategies. Using data across the OECD, I find that almost all financing choices are compatible with efficiency in the delivery of health care, and that there has been no consistent and systematic relationship between financing and cost containment. Using data on expenditures and life expectancy by income quintile from the Canadian health care system, I find that universal, publicly-funded health insurance is modestly redistributive. Putting $1 of tax funds into the public health insurance system effectively channels between $0.23 and $0.26 toward the lowest income quintile people, and about $0.50 to the bottom two income quintiles. Finally, a review of the literature across the OECD suggests that the progressivity of financing of the health insurance system has limited implications for overall income inequality, particularly over time.

JEL-codes: H42 H51 I18 (search for similar items in EconPapers)
Date: 2008-03
New Economics Papers: this item is included in nep-hea, nep-ias and nep-pub
Note: EH
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Citations: View citations in EconPapers (11)

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