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The convergence of health care expenditure in the US states

  • Zijun Wang

    (Private Enterprise Research Center, Texas A&M University, College Station, TX, USA)

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    In response to rising health care costs, many have called for more effective regional health policy coordination. In this paper, we address the issue by examining the degree of convergence in per capita health care expenditure and its nine components across the US states from 1980 to 2004. The major finding is the moderate evidence of convergence in total health care expenditure and the diverse performance of the expenditure components regarding convergence. We also find hospital care to be responsible for the bulk of cross-state convergence in total expenditure. The expenditure on prescription drugs is the most important diverging factor. Policy implications of these empirical results are discussed. Copyright © 2008 John Wiley & Sons, Ltd.

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    File URL: http://hdl.handle.net/10.1002/hec.1343
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    Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

    Volume (Year): 18 (2009)
    Issue (Month): 1 ()
    Pages: 55-70

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    Handle: RePEc:wly:hlthec:v:18:y:2009:i:1:p:55-70
    Contact details of provider: Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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    1. John Nixon, . "Convergence Analysis of Health Care Expenditure in the EU Countries Using Two Approaches," Discussion Papers 99/3, Department of Economics, University of York.
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    7. Zijun Wang & Andrew J. Rettenmaier, 2007. "A note on cointegration of health expenditures and income," Health Economics, John Wiley & Sons, Ltd., vol. 16(6), pages 559-578.
    8. Theo Hitiris, 1997. "Health care expenditure and integration in the countries of the European Union," Applied Economics, Taylor & Francis Journals, vol. 29(1), pages 1-6.
    9. Luisa Corrado & Ron Martin & Melvyn Weeks, 2005. "Identifying and Interpreting Regional Convergence Clusters across Europe," Economic Journal, Royal Economic Society, vol. 115(502), pages C133-C160, 03.
    10. 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, vol. 21(1), pages 147-159, January.
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