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Out-of-pocket payments in the Austrian healthcare system - a distributional analysis

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  • Alice Sanwald
  • Engelbert Theurl

Abstract

Introduction: Out-of-pocket spending is an important source of healthcare financing even in countries with established prepaid financing of healthcare. However, out-of-pocket payments (OOPP) may have undesirable effects from an equity perspective. In this study, we analyse the distributive effects of OOPP in Austria based on cross-sectional information from the Austrian Household Budget Survey 2009/10. Methods: We combine evidence from disaggregated measures (concentration curve and Lorenz curve) and summary indices (Gini coefficient, Kakwani index, and Reynolds-Smolensky index) to demonstrate the distributive effects of total OOPP and their subcomponents. Thereby, we use different specifications of household ability to pay. We follow the Aronson-Johnson-Lampert approach and split the distributive effect into its three components: progressivity, horizontal equity, and reranking. Results: OOPP in Austria have regressive effects on income distribution. These regressive effects are especially pronounced for the OOPP category prescription fees and over-the-counter pharmaceuticals. Dis- aggregated evidence shows that the effects differ between income groups. The decomposition analysis reveals a high degree of reranking and horizontal inequity for total OOPP, and particularly, for therapeutic aids and physician services. Conclusions: The results - especially those for prescription fees and therapeutic aids - are of high relevance for the recent and on-going discussion on the reform of benefit catalogues and cost-sharing schemes in the public health insurance system in Austria.

Suggested Citation

  • Alice Sanwald & Engelbert Theurl, 2015. "Out-of-pocket payments in the Austrian healthcare system - a distributional analysis," Working Papers 2015-05, Faculty of Economics and Statistics, Universität Innsbruck.
    • Handle: RePEc:inn:wpaper:2015-05
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    Cited by:

    1. Gregoire Mercier & Jenica Pastor & Valerie Clément & Ulysse Rodts & Christine Moffat & Isabelle Quéré, 2019. "Out-of-pocket payments, vertical equity and unmet medical needs in France: A national multicenter prospective study on lymphedema," PLOS ONE, Public Library of Science, vol. 14(5), pages 1-13, May.
    2. Andrea M. Leiter & Engelbert Theurl, 2021. "Determinants of prepaid systems of healthcare financing: a worldwide country-level perspective," International Journal of Health Economics and Management, Springer, vol. 21(3), pages 317-344, September.
    3. Hua, Xinyang & Erreygers, Guido & Chalmers, John & Laba, Tracey-Lea & Clarke, Philip, 2017. "Using administrative data to look at changes in the level and distribution of out-of-pocket medical expenditure: An example using Medicare data from Australia," Health Policy, Elsevier, vol. 121(4), pages 426-433.
    4. Grégoire Mercier & Jenica Pastor & Valérie Clément & Ulysse Rodts & Christine Moffat & Isabelle Quéré, 2019. "Out-of-pocket payments, vertical equity and unmet medical needs in France: A national multicenter prospective study on lymphedema," Post-Print hal-02862217, HAL.
    5. Nübler, Laura & Busse, Reinhard & Siegel, Martin, 2022. "The role of consumer choice in out-of-pocket spending on health: A mixed-methods approach," EconStor Preprints 260395, ZBW - Leibniz Information Centre for Economics.
    6. Susanne Mayer & Jonah Spickschen & K Viktoria Stein & Richard Crevenna & Thomas E Dorner & Judit Simon, 2019. "The societal costs of chronic pain and its determinants: The case of Austria," PLOS ONE, Public Library of Science, vol. 14(3), pages 1-18, March.

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    More about this item

    Keywords

    out-of-pocket health expenditure; healthcare financing inequalities; Kakwani index; vertical equity; horizontal equity; reranking;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality

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