Premium Subsidies and Social Insurance: Substitutes or Complements?
AbstractPremium subsidies have been advocated as an alternative to social health insurance. These subsidies are paid if expenditure on health insurance exceeds a given share of income. In this paper, we examine whether this approach is superior to social insurance from a welfare perspective. We show that the results crucially depend on the correlation of health and productivity. For a positive correlation, we find that combining premium subsidies with social insurance is the optimal policy.
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Bibliographic InfoPaper provided by Hamburg Center for Health Economics, University of Hamburg in its series Working Papers with number 2011/01.
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social insurance; health insurance; redistributive taxation; equity;
Other versions of this item:
- Kifmann, Mathias & Roeder, Kerstin, 2011. "Premium subsidies and social insurance: Substitutes or complements?," hche Research Papers 2011/01, Hamburg Center for Health Economics (hche), University of Hamburg.
- H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
- H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
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