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Intergenerational Inequality and the Contract Out Policy in Public Health Care

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  • Miyazato, Naomi

Abstract

This study investigates the impact of a Japanese public health care reform—called the contract out policy—on intergenerational inequality and the probability of a surplus in medical saving accounts. First, I investigate the change in the lifetime net burdens for each generation and public health expenditures and conduct simulation analyses to consider the effects of contracting out public health insurance on intergenerational inequality using the generational accounting method. Next, I simulate the probability of a surplus in medical savings accounts using the transition probability of health care expenses based on individual health data, such as receipt data. According to the simulation results, the net lifetime burden on future generations after contracting out shows a 1% reduction compared to the base case, which is not implemented in public health care reform. In addition, the probability of medical savings accounts remaining in surplus, including cases of zero medical expenses, is 69.6%.

Suggested Citation

  • Miyazato, Naomi, 2020. "Intergenerational Inequality and the Contract Out Policy in Public Health Care," Japan and the World Economy, Elsevier, vol. 54(C).
    • Handle: RePEc:eee:japwor:v:54:y:2020:i:c:s0922142520300013
    DOI: 10.1016/j.japwor.2020.101006
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    References listed on IDEAS

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    1. Kitao, Sagiri, 2015. "Pension reform and individual retirement accounts in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 38(C), pages 111-126.
    2. Kato, Ryuta Ray, 2018. "The future prospect of the long-term care insurance in Japan," Japan and the World Economy, Elsevier, vol. 47(C), pages 1-17.
    3. Auerbach, Alan J. & Chun, Young Jun, 2006. "Generational accounting in Korea," Journal of the Japanese and International Economies, Elsevier, vol. 20(2), pages 234-268, June.
    4. Miyazato, Naomi, 2015. "Intergenerational redistribution policies of the 1990s and 2000s in Japan: An analysis using generational accounting," Japan and the World Economy, Elsevier, vol. 34, pages 1-16.
    5. Alan J. Auerbach & Jagadeesh Gokhale & Laurence J. Kotlikoff, 1991. "Generational Accounts: A Meaningful Alternative to Deficit Accounting," NBER Chapters, in: Tax Policy and the Economy, Volume 5, pages 55-110, National Bureau of Economic Research, Inc.
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    7. Toshihiro Ihori, Ryuta Ray Kato, Masumi Kawade, Shun-ichiro Bessho, 2011. "The Reform Of The Public Health Insurance And Economic Growth Of Japan," Asia Pacific Economic Papers 392, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University.
    8. Matthew J. Eichner & Mark B. McClellan & David A. Wise, 1997. "Health Expenditure Persistence and the Feasibility of Medical Savings Accounts," NBER Chapters, in: Tax Policy and the Economy, Volume 11, pages 91-128, National Bureau of Economic Research, Inc.
    9. Ihori, Toshihiro & Kato, Ryuta Ray & Kawade, Masumi & Bessho, Shun-ichiro, 2011. "Health insurance reform and economic growth: Simulation analysis in Japan," Japan and the World Economy, Elsevier, vol. 23(4), pages 227-239.
    10. Alan J. Auerbach & Jagadeesh Gokhale & Laurence J. Kotlikoff, 1994. "Generational Accounting: A Meaningful Way to Evaluate Fiscal Policy," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 73-94, Winter.
    11. Eric French & Elaine Kelly & Yoko Ibuka & Stacey H. Chen & Yui Ohtsu & Nobuyuki Izumida, 2016. "Medical Spending in Japan: An Analysis Using Administrative Data from a Citizen's Health Insurance Plan," Fiscal Studies, Institute for Fiscal Studies, vol. 37, pages 561-592, September.
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    1. Fukuda, Shin-ichi & Okumura, Koki, 2021. "The aging society, savings rates, and regional flow of funds in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 62(C).

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    More about this item

    Keywords

    Intergenerational inequality; public health; care reform; contract; out policy; simulation analysis;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private

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