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Public Spending on Health and Long-term Care: A new set of projections

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  • Christine de la Maisonneuve
  • Joaquim Oliveira Martins

Abstract

This paper proposes a new set of public health and long-term care expenditure projections till 2060, following up on the previous set of projections published in 2006. It disentangles health from longterm care expenditure as well as the demographic from the non-demographic drivers, and refines the previous methodology, in particular by better identifying the underlying determinants of health and long-term care spending and by extending the country coverage to include BRIICS countries. A costcontainment and a cost-pressure scenario are provided together with sensitivity analysis. On average across OECD countries, total health and long-term care expenditure is projected to increase by 3.3 and 7.7 percentage points of GDP between 2010 and 2060 in the cost-containment and the cost-pressure scenarios respectively. For the BRIICS over the same period, it is projected to increase by 2.8 and 7.3 percentage points of GDP in the cost-containment and the cost-pressure scenarios respectively.

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File URL: http://dx.doi.org/10.1787/5k44t7jwwr9x-en
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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Economic Policy Papers with number 6.

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Date of creation: 26 Jun 2013
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Handle: RePEc:oec:ecoaab:6-en

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Keywords: ageing populations; longevity; long-term care expenditures; demographic and non-demographic effects; public health expenditures; projection methods;

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  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., John Wiley & Sons, Ltd., vol. 16(10), pages 1109-1126.
  2. Stephane Jacobzone, 2003. "Ageing and the Challenges of New Technologies: Can OECD Social and Healthcare Systems Provide for the Future?," The Geneva Papers on Risk and Insurance, The International Association for the Study of Insurance Economics, The International Association for the Study of Insurance Economics, vol. 28, pages 254-274, 04.
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  5. Joaquim Oliveira Martins & Christine de la Maisonneuve, 2006. "The drivers of public expenditure on health and long-term care: An integrated approach," OECD Economic Studies, OECD Publishing, OECD Publishing, vol. 2006(2), pages 115-154.
  6. Rie Fujisawa & Francesca Colombo, 2009. "The Long-Term Care Workforce: Overview and Strategies to Adapt Supply to a Growing Demand," OECD Health Working Papers 44, OECD Publishing.
  7. Peter Zweifel & Stefan Felder & Markus Meiers, 1999. "Ageing of population and health care expenditure: a red herring?," Health Economics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 8(6), pages 485-496.
  8. Acemoglu, Daron & Finkelstein, Amy & Notowidigdo, Matthew J., 2009. "Income and Health Spending: Evidence from Oil Price Shocks," CEPR Discussion Papers, C.E.P.R. Discussion Papers 7255, C.E.P.R. Discussion Papers.
  9. Okunade, Albert A. & Murthy, Vasudeva N. R., 2002. "Technology as a 'major driver' of health care costs: a cointegration analysis of the Newhouse conjecture," Journal of Health Economics, Elsevier, Elsevier, vol. 21(1), pages 147-159, January.
  10. Zhou Yang & Edward C. Norton & Sally C. Stearns, 2003. "Longevity and Health Care Expenditures," Journals of Gerontology: Series B, Gerontological Society of America, Gerontological Society of America, vol. 58(1), pages S2-S10.
  11. Friedrich Breyer & Stefan Felder, 2004. "Life Expectancy and Health Care Expenditures: A New Calculation for Germany Using the Costs of Dying," Discussion Papers of DIW Berlin 452, DIW Berlin, German Institute for Economic Research.
  12. Hitiris, Theo & Posnett, John, 1992. "The determinants and effects of health expenditure in developed countries," Journal of Health Economics, Elsevier, Elsevier, vol. 11(2), pages 173-181, August.
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