IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Population Ageing and Health Care Expenditure: New Evidence on the "Red Herring"

Listed author(s):
  • Peter Zweifel
  • Stefan Felder
  • Andreas Werblow

The observation that average health care expenditure rises with age generally leads experts and laymen alike to conclude that population ageing is the main driver of health care costs. In recently published studies we challenged this view (Zweifel et al., 1999; Felder et al., 2000). Analysing health care expenditure of deceased persons, we showed that age is insignificant if proximity to death is controlled for. Thus, we argued that population ageing per se will not have a significant impact on future health care expenditure. Several authors (Salas and Raftery, 2001; Dow and Norton, 2002; Seshamani and Gray, 2004a) disputed the robustness of these findings, pointing to potential weaknesses in the econometric methodology. This paper revisits the debate and provides new empirical evidence, taking into account the methodological concerns that have been raised. We also include surviving individuals to test for the possibility that the relative importance of proximity to death and age differs between the deceased and survivors. The results vindicate our earlier findings of no significant age effect on health care expenditure of the deceased. However, with respect to the survivors, we find that age may matter. Still, a naive estimation that does not control for proximity to death will grossly overestimate the effect of population ageing on aggregate health care expenditure. Following Stearns and Norton (2004), we conclude that "it is time for time to death" in projections of future health care costs. Copyright 2004 The International Association for the Study of Insurance Economics.

If you experience problems downloading a file, check if you have the proper application to view it first. 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:
File Function: link to full text
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by The International Association for the Study of Insurance Economics in its journal The Geneva Papers.

Volume (Year): 29 (2004)
Issue (Month): 4 (October)
Pages: 652-666

in new window

Handle: RePEc:bla:geneva:v:29:y:2004:i:4:p:652-666
Contact details of provider: Postal:
Route de Malagnou 53, CH - 1208 Geneva

Phone: +41-22 707 66 00
Fax: +41-22 736 75 36
Web page:

More information through EDIRC

Order Information: Web:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:bla:geneva:v:29:y:2004:i:4:p:652-666. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)

or (Christopher F. Baum)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.