Publication: Benefit Incidence Analysis Are Government Health Expenditures : More Pro-Rich Than We Think?
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Date
2012-04
ISSN
1057-9230
Published
2012-04
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Authors of benefit-incidence analyses (BIA) have to impute subsidies using assumptions about the relationship between unobserved subsidies 'captured' by the household and what can be observed at the household and aggregate levels. This paper shows that one of the two assumptions used in BIA studies to date will necessarily produce a more pro-rich (or less pro-poor) picture of government health spending than the other, depending on whether utilization is more pro-rich or pro-poor than fees paid to public providers. Both assumptions have their disadvantages, and the paper suggests a couple of alternatives that explicitly link fees paid to the costliness of care. It shows that in the most likely case where fees are distributed in a more pro-rich fashion than utilization, the two traditional assumptions will produce less pro-rich distributions of subsidies than the two new alternatives. Also considered are three complications that arise in BIA studies, including factoring in social health insurance. The paper's theoretical results are illustrated with an empirical BIA for Vietnam. Copyright (c) 2011 John Wiley & Sons, Ltd. May be used for non-commercial purposes in accordance with Wiley Terms and conditions at http://olabout.wiley.com/WileyCDA/Section/id-817011.html
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Publication Benefit Incidence Analysis Are Government Health Expenditures : More Pro-Rich Than We Think?(2010-03-01)It is generally accepted that government health expenditures should disproportionately benefit the poor. And yet in most developing countries the opposite is the case. This paper examines the implications of a central assumption of benefit incidence analysis, namely that the unit cost of a government-provided service bears no relation to the out-of-pocket payments paid by the patient. It argues that a more plausible assumption is that larger out-of-pocket payments for a given unit of utilization reflect more (or more costly) services being delivered. The paper compares -- theoretically and empirically -- the standard constant-cost assumption with two alternatives, namely that the cost of care in a specific episode of utilization is (a) proportional to or (b) linearly related to the amount of money paid out-of-pocket by the patient. An interesting special case of the linear relationship is where subsidies are focused on a basic unit of care and additional costs are met dollar-for-dollar by additional fees. The paper shows that if fees are more pro-rich than utilization, government spending will be least pro-rich under the constant-cost assumption and most pro-rich under the proportionality assumption. The linear assumption results in a concentration index for subsidies that lies between these two extremes. These results are borne out in an analysis of the incidence of government health spending in Vietnam (a country where fees are more pro-rich than utilization); indeed, under the constant-cost assumption, subsidies are pro-poor while they are pro-rich under the proportionality assumption. The paper also considers the biases created by not allowing for insurance reimbursements.Publication Who Benefits from Government Health Spending and Why? 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The two measures of dispersion or risk—the coefficient of variation and Q90/Q50—are only weakly correlated across countries and not explained by our macroeconomic and health system indicators. Considerable variation emerges in the out-of-pocket health expenditure budget share, which is highly correlated with the incidence of “catastrophic expenditures”. Out-of-pocket expenditures tend to be regressive and catastrophic expenditures tend to be concentrated among the poor when expenditures are assessed relative to income, while expenditures tend to be progressive and catastrophic expenditures tend to be concentrated among the rich when expenditures are assessed relative to consumption. At the extreme poverty line of $1.90-a-day, most impoverishment due to out-of-pocket expenditures occurs among low-income countries.Publication Better Health Systems for India's Poor : Findings, Analysis, and Options(Washington, DC: World Bank, 2002)This report focuses on four areas of the health system in which reforms, and innovations would make the most difference to the future of the Indian health system: oversight, public health service delivery, ambulatory curative care, and inpatient care (together with health insurance). Part 1 of the report contains four chapters that discuss current conditions, and policy options. Part 2 presents the theory, and evidence to support the policy choices. The general reader may be most interested in the overview chapter, and in the highlights found at the beginning of each of the chapters in part 2. These highlights outline the empirical findings, and the main policy challenges discussed in the chapter. The report does not set out to prescribe detailed answers for India's future health system. It does however, have a goal: to support informed debate, and consensus building, and to help shape a health system that continually strives to be more effective, equitable, efficient, and accountable to the Indian people, and particularly to the poor.
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