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Using Income Contingent Loans to Pay for Health Care

In: Income Contingent Loans

Author

Listed:
  • Rhema Vaithianathan

    (Auckland University of Technology
    Singapore Management University)

Abstract

Health care expenditure has traditionally been seen as an ‘investment’ in one’s own human capital. A life course approach to development shows that lack of access to health care in the young can lead to a reduction in schooling and consequently lower wage rates. In high income countries, despite widespread health insurance, some services such as talking therapy for depression are not funded despite depression being a major cause of disability and exit from work. Income contingent loans (ICL) offer an opportunity for those who face potentially high returns to investing in health but are cash constrained from doing so, and where health insurance systems cannot fully overcome the adverse and moral hazard problems. This note suggests areas where ICL could be used to fund health care in both high and low income contexts.

Suggested Citation

  • Rhema Vaithianathan, 2014. "Using Income Contingent Loans to Pay for Health Care," International Economic Association Series, in: Bruce Chapman & Timothy Higgins & Joseph E. Stiglitz (ed.), Income Contingent Loans, chapter 14, pages 165-171, Palgrave Macmillan.
    • Handle: RePEc:pal:intecp:978-1-137-41320-8_15
    DOI: 10.1057/9781137413208_15
    as

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