This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Health expenditure growth: reassessing the threat of ageing

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Brigitte Dormont
Michel Grignon (Departments of Economics and Gerontology, McMaster University, Ontario, Canada)
Hélène Huber (EconomiX, Université Paris 10, Nanterre, France)

Additional information is available for the following registered author(s):

Abstract

In this paper we evaluate the respective effects of demographic change, changes in morbidity and changes in practices on growth in health care expenditures. We use microdata, i.e. representative samples of 3441 and 5003 French individuals observed in 1992 and 2000. Our data provide detailed information about morbidity and allow us to observe three components of expenditures: ambulatory care, pharmaceutical and hospital expenditures.

We propose an original microsimulation method to identify the components of the drift observed between 1992 and 2000 in the health expenditure age profile. On the one hand, we find empirical evidence of health improvement at a given age: changes in morbidity induce a downward drift of the profile. On the other hand, the drift due to changes in practices is upward and sizeable. Detailed analysis attributes most of this drift to technological innovation.

After applying our results at the macroeconomic level, we find that the rise in health care expenditures due to ageing is relatively small. The impact of changes in practices is 3.8 times larger. Furthermore, changes in morbidity induce savings which more than offset the increase in spending due to population ageing. Copyright © 2006 John Wiley & Sons, Ltd.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://hdl.handle.net/10.1002/hec.1165
File Format: text/html
File Function: Link to full text; subscription required
Download Restriction: no

Publisher Info
Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 15 (2006)
Issue (Month): 9 ()
Pages: 947-963
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:wly:hlthec:v:15:y:2006:i:9:p:947-963

Contact details of provider:
Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).

Related research
Keywords:

Other versions of this item:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Leung, Siu Fai & Yu, Shihti, 1996. "On the choice between sample selection and two-part models," Journal of Econometrics, Elsevier, vol. 72(1-2), pages 197-229. [Downloadable!] (restricted)
    Other versions:
  2. Brigitte Dormont & Carine Milcent, 2004. "Innovation diffusion under budget constraints - Microeconometric evidence on heart attack in France -," DELTA Working Papers 2004-11, DELTA (Ecole normale supérieure). [Downloadable!]
  3. Meena Seshamani & Alastair Gray, 2004. "Ageing and health-care expenditure: the red herring argument revisited," Health Economics, John Wiley & Sons, Ltd., vol. 13(4), pages 303-314. [Downloadable!]
  4. François Bourguignon & Francisco H.G. Ferreira & Phillipe G. Leite, 2002. "Beyond Oaxaca-Blinder: accounting for differences in household income distributions across countries," Textos para discussão 452, Department of Economics PUC-Rio (Brazil). [Downloadable!]
    Other versions:
  5. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
    Other versions:
  6. Hitiris, Theo & Posnett, John, 1992. "The determinants and effects of health expenditure in developed countries," Journal of Health Economics, Elsevier, vol. 11(2), pages 173-181, August. [Downloadable!] (restricted)
  7. Oecd, 2006. "Projecting OECD Health and Long-Term Care Expenditures: What Are the Main Drivers?," OECD Economics Department Working Papers 477, OECD, Economics Department. [Downloadable!]
  8. David M. Cutler & Mark McClellan, 1996. "The Determinants of Technological Change in Heart Attack Treatment," NBER Working Papers 5751, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  9. Cutler, David M. & Huckman, Robert S., 2003. "Technological development and medical productivity: the diffusion of angioplasty in New York state," Journal of Health Economics, Elsevier, vol. 22(2), pages 187-217, March. [Downloadable!] (restricted)
    Other versions:
  10. Evans, R.G. & McGrail, K.M. & Morgan, S.G. & Barer, M.L. & Hertzman, C., 2001. "Apocalypse No: Population Aging and the Future of Health Care Systems," Centre for Health Services and Policy Research 2001:3r, University of British Columbia - Centre for Health Services and Policy Research..
  11. Manning, W. G. & Duan, N. & Rogers, W. H., 1987. "Monte Carlo evidence on the choice between sample selection and two-part models," Journal of Econometrics, Elsevier, vol. 35(1), pages 59-82, May. [Downloadable!] (restricted)
  12. Peter Zweifel & Stefan Felder & Markus Meiers, 1999. "Ageing of population and health care expenditure: a red herring?," Health Economics, John Wiley & Sons, Ltd., vol. 8(6), pages 485-496.
  13. Denton, Frank T. & Gafni, Amiram & Spencer, Byron G., 2002. "Exploring the effects of population change on the costs of physician services," Journal of Health Economics, Elsevier, vol. 21(5), pages 781-803, September. [Downloadable!] (restricted)
    Other versions:
  14. Peter Zweifel & Stefan Felder & Andreas Werblow, 2004. "Population Ageing and Health Care Expenditure: New Evidence on the "Red Herring"," The Geneva Papers on Risk and Insurance, The International Association for the Study of Insurance Economics, vol. 29(4), pages 652-666, October. [Downloadable!] (restricted)
  15. Christian Salas & James P. Raftery, 2001. "Econometric issues in testing the age neutrality of health care expenditure," Health Economics, John Wiley & Sons, Ltd., vol. 10(7), pages 669-671. [Downloadable!]
  16. Seshamani, Meena & Gray, Alastair M., 2004. "A longitudinal study of the effects of age and time to death on hospital costs," Journal of Health Economics, Elsevier, vol. 23(2), pages 217-235, March. [Downloadable!] (restricted)
  17. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January. [Downloadable!] (restricted)
  18. Dov Chernichovsky & Sara Markowitz, 2004. "Aging and aggregate costs of medical care: conceptual and policy issues," Health Economics, John Wiley & Sons, Ltd., vol. 13(6), pages 543-562. [Downloadable!]
  19. Sally C. Stearns & Edward C. Norton, 2004. "Time to include time to death? The future of health care expenditure predictions," Health Economics, John Wiley & Sons, Ltd., vol. 13(4), pages 315-327. [Downloadable!]
  20. Jean-Pierre Michel & Jean-Marie Robine, 2004. "A "New" General Theory of Population Ageing," The Geneva Papers on Risk and Insurance, The International Association for the Study of Insurance Economics, vol. 29(4), pages 667-678, October. [Downloadable!] (restricted)
  21. Gerdtham, Ulf-G. & Sogaard, Jes & Andersson, Fredrik & Jonsson, Bengt, 1992. "An econometric analysis of health care expenditure: A cross-section study of the OECD countries," Journal of Health Economics, Elsevier, vol. 11(1), pages 63-84, May. [Downloadable!] (restricted)
  22. R.G. Evans & K.M. McGrail & S.G. Morgan & M.L. Barer & C. Hertzman, 2001. "APOCALYPSE NO: Population Aging and the Future of Health Care Systems," Social and Economic Dimensions of an Aging Population Research Papers 59, McMaster University. [Downloadable!]
  23. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October. [Downloadable!] (restricted)
    Other versions:
  24. Manning, Willard G. & Mullahy, John, 2001. "Estimating log models: to transform or not to transform?," Journal of Health Economics, Elsevier, vol. 20(4), pages 461-494, July. [Downloadable!] (restricted)
    Other versions:
  25. Brigitte Dormont & Hélène Huber, 2006. "Causes of Health Expenditure Growth: the Predominance of Changes in Medical Practices Over Population Ageing," Annales d'Economie et de Statistique, ADRES, issue 83-84, pages 08, Juillet-D. [Downloadable!]
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Andreas Werblow & Stefan Felder & Peter Zweifel, 2007. "Population ageing and health care expenditure: a school of 'red herrings'?," Health Economics, John Wiley & Sons, Ltd., vol. 16(10), pages 1109-1126. [Downloadable!]
  2. France Weaver & Sally C. Stearns & Edward C. Norton & William Spector, 2009. "Proximity to death and participation in the long-term care market," Health Economics, John Wiley & Sons, Ltd., vol. 18(8), pages 867-883. [Downloadable!]
  3. Xavier Pautrel, 2009. "Health-enhancing activities and the environment:How competition for resources make the environmental policy beneficial," Working Papers hal-00423323_v1, HAL. [Downloadable!]
  4. Valerie Albouy & Laurent Davezies & Thierry Debrand, 2009. "Dynamic Estimation of Health Expenditure: A new approach for simulating individual expenditure," Working Papers DT20, IRDES institut for research and information in health economics, revised Jan 2009. [Downloadable!]
Statistics
Access and download statistics

Did you know? About 1000 journals are listed on RePEc.

This page was last updated on 2009-11-16.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.