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Exploring the Effects of Population Change on the Costs of Physician Services

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  • Frank T. Denton
  • Amiram Gafni
  • Byron G. Spencer

Abstract

The effects of population aging on future health care costs are an important public policy concern in many countries. We focus in this paper on physician services and investigate how changes in the size and age distribution of a population can affect the aggregate and per capita costs of such services. The principal data set (unpublished, for Ontario) provides information about payments to physicians, by age and sex of patients. Using it, we derive age/cost profiles for 19 categories of physicians. Adopting an index-theoretic framework, we then use the profiles to analyse the "pure" effects of population change (historical or projected) on physician costs, and to decompose the effects into population growth effects and population aging effects. We present calculations for Ontario, for the populations of 15 industrialized countries, and for four theoretical populations.

Suggested Citation

  • Frank T. Denton & Amiram Gafni & Byron G. Spencer, 2001. "Exploring the Effects of Population Change on the Costs of Physician Services," Quantitative Studies in Economics and Population Research Reports 358, McMaster University.
  • Handle: RePEc:mcm:qseprr:358
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    References listed on IDEAS

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    1. Ronald Lee & Jonathan Skinner, 1999. "Will Aging Baby Boomers Bust the Federal Budget?," Journal of Economic Perspectives, American Economic Association, vol. 13(1), pages 117-140, Winter.
    2. Ronald Lee & Shripad Tuljapurkar, 1998. "Stochastic Forecasts for Social Security," NBER Chapters,in: Frontiers in the Economics of Aging, pages 393-428 National Bureau of Economic Research, Inc.
    3. Denton, Frank T. & Gafni, Amiram & Spencer, Byron G., 1995. "The SHARP way to plan health care services: A description of the system and some illustrative applications in nursing human resource planning," Socio-Economic Planning Sciences, Elsevier, vol. 29(2), pages 125-137, June.
    4. Frank T. Denton & Amiram Gafni & Byron G. Spencer, 2001. "Population Change and the Requirements for Physicians: The Case of Ontario," Canadian Public Policy, University of Toronto Press, vol. 27(4), pages 469-485, December.
    5. Lee, Ronald & Tuljapurkar, Shripad, 1998. "Uncertain Demographic Futures and Social Security Finances," American Economic Review, American Economic Association, vol. 88(2), pages 237-241, May.
    6. Frank T. Denton & Byron G. Spencer, 1999. "Population Aging and Its Economic Costs: A Survey of the Issues and Evidence," Social and Economic Dimensions of an Aging Population Research Papers 1, McMaster University.
    7. Ronald Lee & Shripad Tuljapurkar, 1997. "Death and Taxes: Longer life, consumption, and social security," Demography, Springer;Population Association of America (PAA), vol. 34(1), pages 67-81, February.
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    Citations

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    Cited by:

    1. Papachristos, George & Adamides, Emmanuel, 2016. "A retroductive systems-based methodology for socio-technical transitions research," Technological Forecasting and Social Change, Elsevier, vol. 108(C), pages 1-14.
    2. Galea, Sandro & Freudenberg, Nicholas & Vlahov, David, 2005. "Cities and population health," Social Science & Medicine, Elsevier, vol. 60(5), pages 1017-1033, March.
    3. Frank T. Denton & Amiram Gafni & Byron G. Spencer, 2005. "Users and Suppliers of Physician Services: A Tale of Two Populations," Quantitative Studies in Economics and Population Research Reports 399, McMaster University.
    4. Frank T. Denton & Byron G. Spencer, 2009. "Chronic Health Conditions: Changing Prevalence in an Aging Population and Some Implications for the Delivery of Health Care Services," Social and Economic Dimensions of an Aging Population Research Papers 259, McMaster University.
    5. Brigitte Dormont & Michel Grignon & Hélène Huber, 2006. "Health expenditure growth: reassessing the threat of ageing," Health Economics, John Wiley & Sons, Ltd., vol. 15(9), pages 947-963.
    6. Fu, Hwai-Hui & Tsai, Hsien-Tang & Lin, Ching-Wei & Wei, Duan, 2004. "Application of a single sampling plan for auditing medical-claim payments made by Taiwan National Health Insurance," Health Policy, Elsevier, vol. 70(2), pages 185-195, November.
    7. Hwai-Hui Fu & Dennis Lin & Hsien-Tang Tsai & Duan Wei, 2009. "Applying lot-by-lot double sampling plan to reform Taiwan National Health Insurance auditing system," Quality & Quantity: International Journal of Methodology, Springer, vol. 43(4), pages 571-584, July.
    8. Frank T. Denton & Christine H. Feaver & Byron G. Spencer, 2008. "An Application of Price and Quantity Indexes in the Analysis of Changes in Expenditures on Physician Services," Quantitative Studies in Economics and Population Research Reports 426, McMaster University.
    9. Baoping Shang & Dana Goldman, 2008. "Does age or life expectancy better predict health care expenditures?," Health Economics, John Wiley & Sons, Ltd., vol. 17(4), pages 487-501.
    10. Di Matteo, Livio, 2005. "The macro determinants of health expenditure in the United States and Canada: assessing the impact of income, age distribution and time," Health Policy, Elsevier, vol. 71(1), pages 23-42, January.
    11. Sarma, Sisira & Simpson, Wayne, 2007. "A panel multinomial logit analysis of elderly living arrangements: Evidence from aging in Manitoba longitudinal data, Canada," Social Science & Medicine, Elsevier, vol. 65(12), pages 2539-2552, December.

    More about this item

    Keywords

    aging; population change; physicians; health care costs;

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts

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