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Insurance coverage and the heterogeneity of health and drug spending in the United States

Gemmill, Marin, Costa-i-Font, Joan and Kanavos, Panos (2006) Insurance coverage and the heterogeneity of health and drug spending in the United States. Geneva Papers on Risk and Insurance, 31 (4). pp. 669-691. ISSN 1018-5895

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Abstract

The rise in health expenditure in the U.S. has generated interest in the determinants of health expenditure at the micro-level; however, individuals may exhibit differential behaviour across different types of health care. In addition, public and private insurance may have an heterogeneous effect on expenditure. In this paper, we examine the determinants of health expenditure with a multivariate regression model along with controls for insurance choice and unobserved health care utilization. We find age-related effects and evidence of moral hazard related to private insurance, while the primary effect of income on expenditure appears to be through the purchase of insurance. The implications of the study are that: (i) policymakers should be less concerned about the effect of ageing on health expenditure; (ii) drug spending may not be related to the expansion of public insurance coverage; and (iii) income may have a negative impact on most elements of health spending.

Item Type: Article
Official URL: http://www.palgrave-journals.com/gpp/index.html
Additional Information: © 2006 The International Association for the Study of Insurance Economics
Library of Congress subject classification: R Medicine > RA Public aspects of medicine
Sets: Departments > Social Policy
Departments > European Institute
Research centres and groups > LSE Health
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Date Deposited: 23 Nov 2009 11:57
URL: http://eprints.lse.ac.uk/25868/

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