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This technical note analyzes the health care spending issues in advanced economies. Both public and total health spending have increased substantially in advanced countries. Total health spending increased by more than 6 percentage points of GDP in the Organization for Economic Cooperation and Development countries between 1970 and 2007. This note examines the recent trends in health care spending in advanced countries. It discusses the main challenges for advanced countries over the medium term. Policy options for containing health care costs are also described.
Insurance --- Public Finance --- Health Policy --- National Government Expenditures and Health --- Health: Government Policy --- Regulation --- Public Health --- Analysis of Health Care Markets --- Insurance Companies --- Actuarial Studies --- Health: General --- National Government Expenditures and Related Policies: General --- Public finance & taxation --- Health systems & services --- Insurance & actuarial studies --- Health economics --- Health care spending --- Health care --- Health --- Expenditure --- Financial institutions --- Expenditures, Public --- Medical care --- United States
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This paper exploits the staggered adoption of major concurrent health reforms in countries in Europe and Central Asia after 1990 to estimate their impact on public health expenditure, utilization, and avoidable deaths. While the health systems all derived from the same paradigm under central planning, they have since introduced changes to policies regarding cost-sharing, provider payment, financing, and the rationalization of hospital infrastructure. Social health insurance is predicted to increase this share, although the leads of both social health insurance and primary care fee-for-service suggest endogeneity may be an issue with the outpatient share regressions. Provider payment reforms produce the largest impact on spending, with fee-for-service increasing spending and patient-based payment reducing it. The impact on avoidable deaths is generally negligible, but there is some evidence of improvements due to fee-for-service. Considering the corresponding relative reduction in inpatient admissions and the incentives fee-for-service provides to deliver additional services, perhaps there is an overprovision of services in the primary care setting and an underutilization of more specialized hospital services.
Health care reform --- Health care reorm --- Health planning --- Medical policy --- Comprehensive health planning --- Health care planning --- Health services planning --- Medical care --- Medical care planning --- Public health --- Planning --- Health services administration --- Health reform --- Health system reform --- Healthcare reform --- Medical care reform --- Reform of health care delivery --- Reform of medical care delivery --- Health insurance --- Health care policy --- Health policy --- Medicine and state --- Policy, Medical --- Public health policy --- State and medicine --- Science and state --- Social policy --- Government policy --- Insurance --- Personal Finance -Taxation --- Public Finance --- National Government Expenditures and Health --- National Government Expenditures and Related Policies: General --- Personal Income and Other Nonbusiness Taxes and Subsidies --- Insurance Companies --- Actuarial Studies --- Health: General --- Public finance & taxation --- Insurance & actuarial studies --- Health economics --- Health care spending --- Expenditure --- Tax allowances --- Health --- Expenditures, Public --- Income tax --- Czech Republic
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Government spending on health has grown as a percent of GDP over the last 40 years in industrialized countries. Widespread decentralization of healthcare systems has often accompanied this increase in spending. In this paper, we explore the effect of soft budget constraints on subnational health spending in a sample of OECD countries. We find countries where subnational governments rely primarily on central government financing and enjoy large borrowing autonomy have higher healthcare spending than those with more restrictions on subnational government borrowing.
Medical care, Cost of --- Budget --- Budgeting --- Expenditures, Public --- Finance, Public --- Cost of medical care --- Health care costs --- Health care expenditures --- Medical care --- Medical costs --- Medical expenses --- Medical service, Cost of --- Medicine --- Medical economics --- Medical savings accounts --- Forecasting --- Costs --- Macroeconomics --- Public Finance --- National Government Expenditures and Health --- National Government Expenditures and Related Policies: General --- Comparative or Joint Analysis of Fiscal and Monetary Policy --- Stabilization --- Treasury Policy --- Health: General --- Public finance & taxation --- Health economics --- Health care spending --- Expenditure --- Fiscal stabilization --- Total expenditures --- Health --- Fiscal policy --- United States
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This paper provides estimates of the changes in premiums, average or expected out of pocket payments, and the sum of premiums and out of pocket payments (total expected price) for a sample of consumers who bought individual insurance in 2010 to 2012, comparing total expected prices before the Affordable Care Act with estimates of total expected prices if they were to purchase silver or bronze coverage after reform, before the effects of any premium subsidies. We provide comparisons for purchasers of self only coverage in California and in 23 states with minimal prior state premium regulation before the ACA now using federally managed exchanges. Using data from the Current Population Survey, we find that the average prices increased by 14 to 28 percent, with similar changes in California and the federal exchange states; we attribute the increase primarily to higher premiums in exchanges associated with insurer expectations of a higher risk population being enrolled. The increase in total expected price is similar for age-gender population subgroups except for a larger than average increases for older women. A welfare calculation of the change in risk premium associated with moving from coverage that prevailed before reform to bronze or silver coverage finds small changes.
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This paper estimates the change in net (of subsidy) financial burden ("the price of responsibility") and in welfare that would be experienced by a large nationally representative sample of the "non-poor" uninsured if they were to purchase Silver or Bronze plans on the ACA exchanges. The sample is the set of full-year uninsured persons represented in the Current Population Survey for the pre-ACA period with incomes above 138 percent of the federal poverty level. The estimated change in financial burden compares out-of-pocket payments by income stratum in the pre-ACA period with the sum of premiums (net of subsidy) and expected cost sharing (net of subsidy) for benchmark Silver and Bronze plans, under various assumptions about the extent of increased spending associated with obtaining coverage. In addition to changes in the financial burden, our welfare estimates incorporate the value of additional care consumed and the change in risk premiums for changes in exposure to out-of-pocket payments associated with coverage, under various assumptions about risk aversion. We find that the average financial burden will increase for all income levels once insured. Subsidy-eligible persons with incomes below 250 percent of the poverty threshold likely experience welfare improvements that offset the higher financial burden, depending on assumptions about risk aversion and the value of additional consumption of medical care. However, even under the most optimistic assumptions, close to half of the formerly uninsured (especially those with higher incomes) experience both higher financial burden and lower estimated welfare; indicating a positive "price of responsibility" for complying with the individual mandate. The percentage of the sample with estimated welfare increases is close to matching observed take-up rates by the previously uninsured in the exchanges.
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Government spending on health has grown as a percent of GDP over the last 40 years in industrialized countries. Widespread decentralization of healthcare systems has often accompanied this increase in spending. In this paper, we explore the effect of soft budget constraints on subnational health spending in a sample of OECD countries. We find countries where subnational governments rely primarily on central government financing and enjoy large borrowing autonomy have higher healthcare spending than those with more restrictions on subnational government borrowing.
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We study the Medicare Part D prescription drug insurance program as a bellwether for designs of private, non-mandatory health insurance markets, focusing on the ability of consumers to evaluate and optimize their choices of plans. Our analysis of administrative data on medical claims in Medicare Part D suggests that less than 10 percent of individuals enroll in plans that are ex post optimal with respect to total cost (premiums and co-payments). Relative to the benchmark of a static decision rule, similar to the Plan Finder provided by the Medicare administration, that conditions next year's plan choice only on the drugs consumed in the current year, enrollees lost on average about $300 per year. These numbers are hard to reconcile with decision costs alone; it appears that unless a sizeable fraction of consumers value plan features other than cost, they are not optimizing effectively.
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We examine whether the least educated population groups experienced the worst mortality trends during the 21st century by measuring changes in mortality across education quartiles. We document sharply differing gender patterns. Among women, mortality trends improved fairly monotonically with education. Conversely, male trends for the lowest three education quartiles were often similar. For both sexes, the gap in average mortality between the top 25 percent and the bottom 75 percent is growing. However, there are many groups for whom these average patterns are reversed - with better experiences for the less educated - or where the differences are statistically indistinguishable.
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