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

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

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 The principal data set (unpublished, for Ontario) provides information about payments to physicians, by age and sex of patients.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.

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File URL: http://socserv.mcmaster.ca/sedap/p/SEDAP43.pdf
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Paper provided by McMaster University in its series Social and Economic Dimensions of an Aging Population Research Papers with number 43.

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Length: 38 pages
Date of creation: Apr 2001
Date of revision:
Handle: RePEc:mcm:sedapp:43
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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. 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.
  3. 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.
  4. 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.
  5. Frank T. Denton & Amiram Gafni & Byron G. Spencer, 2000. "Population Change and the Requirements for Physicians: The Case of Ontario," Social and Economic Dimensions of an Aging Population Research Papers 29, McMaster University.
  6. Lee, Ronald & Tuljapurkar, Shripad, 1998. "Uncertain Demographic Futures and Social Security Finances," American Economic Review, American Economic Association, vol. 88(2), pages 237-41, May.
  7. Ronald Lee & Shripad Tuljapurkar, 1997. "Death and Taxes: Longer life, consumption, and social security," Demography, Springer, vol. 34(1), pages 67-81, February.
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