IDEAS home Printed from https://ideas.repec.org/p/fip/fedgfe/2004-14.html
   My bibliography  Save this paper

The effects of technology on the age distribution of health spending: a cross-country perspective

Author

Listed:
  • Louise Sheiner

Abstract

The conventional method used to project a country's future health care expenditures is to assume that relative health spending by age remains constant. This method has been criticized as being too pessimistic, on the one hand, because of continued improvements in the health status of older people, and as too optimistic, on the other, because of the effects of technological innovations on increasing health spending on the elderly relative to the nonelderly. This paper uses cross-country data to shed light on this question. I find that, contrary to conventional wisdom, the theoretical effects of technology on health spending are to decrease the concentration of health spending on the elderly. Empirically, I find that relative health spending by age has been quite stable over time. I also find that countries with the most technologically intensive health sectors spend relatively less on the oldest old compared to the younger old.

Suggested Citation

  • Louise Sheiner, 2004. "The effects of technology on the age distribution of health spending: a cross-country perspective," Finance and Economics Discussion Series 2004-14, Board of Governors of the Federal Reserve System (U.S.).
    • Handle: RePEc:fip:fedgfe:2004-14
    as

    Download full text from publisher

    File URL: http://www.federalreserve.gov/pubs/feds/2004/200414/200414abs.html
    Download Restriction: no
    File URL: http://www.federalreserve.gov/pubs/feds/2004/200414/200414pap.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Brockmann, Hilke, 2002. "Why is less money spent on health care for the elderly than for the rest of the population? Health care rationing in German hospitals," Social Science & Medicine, Elsevier, vol. 55(4), pages 593-608, August.
    2. David M. Cutler & Ellen Meara, 2001. "The Concentration of Medical Spending: An Update," NBER Chapters, in: Themes in the Economics of Aging, pages 217-240, National Bureau of Economic Research, Inc.
    3. David M. Cutler & Ellen Meara, 1998. "The Medical Costs of the Young and Old: A Forty-Year Perspective," NBER Chapters, in: Frontiers in the Economics of Aging, pages 215-246, National Bureau of Economic Research, Inc.
    4. Lynelle Moon & Pierre Moïse & Stephane Jacobzone, 2003. "Stroke Care in OECD Countries: A Comparison of Treatment, Costs and Outcomes in 17 Countries," OECD Health Working Papers 5, OECD Publishing.
    5. David M. Cutler & Louise Sheiner, 1998. "Demographics and Medical Care Spending: Standard and Non-Standard Effects," NBER Working Papers 6866, National Bureau of Economic Research, Inc.
    6. Auerbach,Alan J. & Lee,Ronald D. (ed.), 2001. "Demographic Change and Fiscal Policy," Cambridge Books, Cambridge University Press, number 9780521662444.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Louise Sheiner, 2009. "Intergenerational aspects of health care," Finance and Economics Discussion Series 2009-38, Board of Governors of the Federal Reserve System (U.S.).
    2. Xiaotong Niu & Melinda Buntin & Joyce Manchester, 2015. "Changes in Medicare Spending per Beneficiary by Age: Working Paper 2015-08," Working Papers 51027, Congressional Budget Office.
    3. Roel van Elk & Esther Mot & P.H. Franses, 2009. "Modelling health care expenditures; overview of the literature and evidence from a panel time series model," CPB Discussion Paper 121.rdf, CPB Netherlands Bureau for Economic Policy Analysis.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ed Westerhout & Frank Pellikaan, 2005. "Can we afford to live longer in better health?," CPB Document 85, CPB Netherlands Bureau for Economic Policy Analysis.
    2. Gan, Lydia L. & Frederick, James R., 2010. "The Willingness to Spend on Healthcare: Evidence from Singapore," Review of Applied Economics, Lincoln University, Department of Financial and Business Systems, vol. 6(1-2), pages 1-15, April.
    3. Carlos Bethencourt & Vincenzo Galasso, "undated". "On the Political Complementarity between Health Care and Social Security," Working Papers 184, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    4. Murphy, Michael & Martikainen, Pekka, 2013. "Use of hospital and long-term institutional care services in relation to proximity to death among older people in Finland," Social Science & Medicine, Elsevier, vol. 88(C), pages 39-47.
    5. David M. Cutler & Ellen Meara, 2001. "The Concentration of Medical Spending: An Update," NBER Chapters, in: Themes in the Economics of Aging, pages 217-240, National Bureau of Economic Research, Inc.
    6. Louise Sheiner, 2009. "Intergenerational aspects of health care," Finance and Economics Discussion Series 2009-38, Board of Governors of the Federal Reserve System (U.S.).
    7. John B. Shoven, 2007. "New Age Thinking: Alternative Ways of Measuring Age, Their Relationship to Labor Force Participation, Goverment Policies and GDP," NBER Working Papers 13476, National Bureau of Economic Research, Inc.
    8. Thomas Bjørner & Søren Arnberg, 2012. "Terminal costs, improved life expectancy and future public health expenditure," International Journal of Health Economics and Management, Springer, vol. 12(2), pages 129-143, June.
    9. Ed Westerhout & Frank Pellikaan, 2005. "Can we afford to live longer in better health?," CPB Document 85.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    10. John Sabelhaus & Michael Simpson & Julie Topoleski, 2004. "Incorporating Longevity Effects into Long-Term Medicare Projections: Technical Paper 2004-02," Working Papers 15190, Congressional Budget Office.
    11. John B. Shoven, 2008. "Adjusting Government Policies for Age Inflation," NBER Working Papers 14231, National Bureau of Economic Research, Inc.
    12. Mehrdad Roham & Anait R. Gabrielyan & Norman P. Archer & Michel L. Grignon & Byron G. Spencer, 2014. "The Impact Of Technological Intensity Of Service Provision On Physician Expenditures: An Exploratory Investigation," Health Economics, John Wiley & Sons, Ltd., vol. 23(10), pages 1224-1241, October.
    13. Michel Grignon, 2005. "Aging, Health and Aggregate Medical Care Spending in France," Department of Economics Working Papers 2005-05, McMaster University.
    14. Wörz, Markus, 2011. "Financial consequences of falling ill: Changes in the German health insurance system since the 1980s," Discussion Papers, Research Unit: Inequality and Social Integration SP I 2011-209, WZB Berlin Social Science Center.
    15. d'Albis, Hippolyte & Collard, Fabrice, 2011. "Age Groups and the Measure of Population Aging," LERNA Working Papers 11.05.339, LERNA, University of Toulouse.
    16. Louise Sheiner & David M. Cutler, 2000. "Generational Aspects of Medicare," American Economic Review, American Economic Association, vol. 90(2), pages 303-307, May.
    17. Berndt Ernst R. & Cockburn Iain M. & Cocks Douglas L. & Epstein Arnold M. & Griliches Zvi, 1998. "Is Price Inflation Different for the Elderly? An Empirical Analysis of Prescription Drugs," Forum for Health Economics & Policy, De Gruyter, vol. 1(1), pages 1-45, January.
    18. Barbara Berkel & Axel Börsch-Supan, 2004. "Pension Reform in Germany: The Impact on Retirement Decisions," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 60(3), pages 393-421, September.
    19. Peter Lloyd-Sherlock, 2000. "Failing the needy: public social spending in Latin America," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(1), pages 101-119.
    20. Raffelhüschen, Bernd, 2001. "Generational accounting: Quo vadis?," Discussion Papers 95, Albert-Ludwigs-Universität Freiburg, Institut für Finanzwissenschaft.

    More about this item

    Keywords

    Medical care; Cost of; Population;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedgfe:2004-14. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ryan Wolfslayer ; Keisha Fournillier (email available below). General contact details of provider: https://edirc.repec.org/data/frbgvus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.