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Inequity in publicly funded physician care: what is the role of private prescription drug insurance?

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  • Sara Allin

    (LSE Health, London School of Economics and Political Science, London, UK)

  • Jeremiah Hurley

    (Department of Economics and Centre for Health Economics and Policy Analysis, McMaster University, Hamilton, Ontario, Canada)

Abstract

This study examines the impact that private financing of prescription drugs in Canada has on equity in the utilization of publicly financed physician services. The complementary nature of prescription drugs and physician service use alongside the reliance on private finance for drugs may induce an income gradient in the use of physicians. We use established econometric methods based on concentration curves to measure equity in physician utilization and its contributors in the province of Ontario. We find that individuals with prescription drug insurance make more physician visits than do those without insurance, and the effect on utilization is stronger for the likelihood of a visit than the conditional number of visits, and stronger for individuals with at least one chronic condition than those with no conditions. Results of the equity analyses reveal that the most important contributors to the pro-rich inequity in physician utilization are income and private prescription drug insurance, while public insurance, which covers older people and those on social assistance, has a pro-poor effect. These findings highlight that inequity in access to and use of publicly funded services may arise from the interaction with privately financed health services that are complements to the use of public services. Copyright © 2008 John Wiley & Sons Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.1428
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Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 18 (2009)
Issue (Month): 10 ()
Pages: 1218-1232

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Handle: RePEc:wly:hlthec:v:18:y:2009:i:10:p:1218-1232

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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  1. Thomas C. Buchmueller & Agnès Couffinhal & Michel Grignon & Marc Perronin, 2002. "Access to Physician Services: Does Supplemental Insurance Matter? Evidence from France," NBER Working Papers 9238, National Bureau of Economic Research, Inc.
  2. Kakwani, Nanak & Wagstaff, Adam & van Doorslaer, Eddy, 1997. "Socioeconomic inequalities in health: Measurement, computation, and statistical inference," Journal of Econometrics, Elsevier, Elsevier, vol. 77(1), pages 87-103, March.
  3. Wagstaff, Adam & van Doorslaer, Eddy & Paci, Pierella, 1991. "On the measurement of horizontal inequity in the delivery of health care," Journal of Health Economics, Elsevier, Elsevier, vol. 10(2), pages 169-205, July.
  4. Jeremiah Hurley & Emmanuel Guindon, 2008. "Private Health Insurance in Canada," Centre for Health Economics and Policy Analysis Working Paper Series, Centre for Health Economics and Policy Analysis (CHEPA), McMaster University, Hamilton, Canada 2008-04, Centre for Health Economics and Policy Analysis (CHEPA), McMaster University, Hamilton, Canada.
  5. Wagstaff, Adam & Van Doorslaer, Eddy & Watanabe, Naoko, 2001. "On decomposing the causes of health sector inequalities with an application to malnutrition inequalities in Vietnam," Policy Research Working Paper Series 2714, The World Bank.
  6. Lori J. Curtis & William J. MacMinn, 2007. "Health-Care Utilization in Canada: 25 Years of Evidence," Social and Economic Dimensions of an Aging Population Research Papers, McMaster University 190, McMaster University.
  7. Amitabh Chandra & Jonathan Gruber & Robin McKnight, 2007. "Patient Cost-Sharing, Hospitalization Offsets, and the Design of Optimal Health Insurance for the Elderly," NBER Working Papers 12972, National Bureau of Economic Research, Inc.
  8. Kapur, Vishnu & Basu, Kisalaya, 2005. "Drug coverage in Canada: who is at risk?," Health Policy, Elsevier, Elsevier, vol. 71(2), pages 181-193, February.
  9. Kimball Lewis & Marilyn Ellwood & John L. Czajka, 1998. "Counting the Uninsured: A Review of the Literature," Mathematica Policy Research Reports, Mathematica Policy Research 2479, Mathematica Policy Research.
  10. Mark Stabile, 2001. "Private insurance subsidies and public health care markets: evidence from Canada," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 34(4), pages 921-942, November.
  11. Grossman, Michael, 1972. "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 80(2), pages 223-55, March-Apr.
  12. Baoping Shang & Dana P. Goldman, 2007. "Prescription Drug Coverage and Elderly Medicare Spending," NBER Working Papers 13358, National Bureau of Economic Research, Inc.
  13. Dolores Jiménez-Rubio & Peter C. Smith & Eddy Van Doorslaer, 2008. "Equity in health and health care in a decentralised context: evidence from Canada," Health Economics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 17(3), pages 377-392.
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Cited by:
  1. Jeremiah Hurley & Emmanuel Guindon, 2008. "Private Health Insurance in Canada," Centre for Health Economics and Policy Analysis Working Paper Series, Centre for Health Economics and Policy Analysis (CHEPA), McMaster University, Hamilton, Canada 2008-04, Centre for Health Economics and Policy Analysis (CHEPA), McMaster University, Hamilton, Canada.
  2. Devlin, Rose Anne & Sarma, Sisira & Zhang, Qi, 2011. "The role of supplemental coverage in a universal health insurance system: Some Canadian evidence," Health Policy, Elsevier, Elsevier, vol. 100(1), pages 81-90, April.
  3. Nolan, Anne & Smith, Samantha, 2012. "The effect of differential eligibility for free GP services on GP utilisation in Ireland," Social Science & Medicine, Elsevier, Elsevier, vol. 74(10), pages 1644-1651.
  4. Allin, Sara & Law, Michael R. & Laporte, Audrey, 2013. "How does complementary private prescription drug insurance coverage affect seniors’ use of publicly funded medications?," Health Policy, Elsevier, Elsevier, vol. 110(2), pages 147-155.

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