Do healthcare tax credits help poor-health individuals on low incomes?

In several countries, personal income tax permits tax credits for out-of-pocket healthcare expenditure. Tax credits benefit taxpayers at all income levels by reducing their net tax liability and modify the price of out-of-pocket expenditure. To the extent that consumer demand is price elastic, they may influence the amount of eligible healthcare expenditure for which taxpayers may claim a credit. These effects influence, in turn, income distributions and taxpayers’ health status and therefore income-related inequality in health. Redistributive consequences of tax credits have been widely investigated. However, little is known about the ability of tax credits to alleviate health inequality. In this paper, we study the potential effects that tax credits for health expenses may have on income-related inequality in health status with reference to the Italian institutional setting. The analysis is performed using a tax-benefit microsimulation model that reproduces the personal income tax and incorporates taxpayers’ behavioral responses to changes in tax credit rate. Our results suggest that the current healthcare tax credit design tends to favor the richest part of the population.     

Horizontal inequity in the utilisation of healthcare services in Australia

The Australian universal healthcare system aims to ensure affordable and equitable use of healthcare services based on individual health needs. This paper presents empirical evidence on the extent of horizontal inequity (HI) in healthcare services (unequal utilisation by income for equal need) in Australia during the period of promoting reliance on private healthcare financing. Using data from the most recent Australian National Health Survey of 2011−12 and 2014−15, we examined and measured the extent of HI in eight indicators of out-of-hospital services and hospital-related care. Contrary to earlier studies, our results show a small but pro-rich inequity in the probability of general practitioner visits. Inequity in the distribution of specialist and dentist visits was in favour of richer people, a result that is commonly found in other developed countries and is also consistent with existing Australian evidence. Hospital-related care was equitably distributed compared to the pro-poor pattern found in earlier studies. Despite the universal health insurance system in Australia, there was inequity in the utilisation of needed healthcare services. Our evidence is relevant to similar health systems as governments move to higher out-of-pocket payments and other private sources to reduce pressure on public healthcare expenditure.     

Achievement of equity and universal access in China's health service: A commentary on the historical reform perspective from the UK National Health Service

Abstract

This paper aims to examine the UK National Health Service (NHS) in the historical context of its background reforms and to investigate future developmental strategies for China's health system. We focus on the central issues facing China's future healthcare development: equity and access. China and the UK have approached healthcare reform from opposite perspectives, the NHS has maintained the core principle of providing universal health coverage throughout the decades. However, due to increasing demand, reforms to improve and sustain efficiency have meant increasing government funding while introducing elements of a market system. Conversely, China has moved from a centrally planned system to a fee-for-service system, but serious problems of inequity and access call for new methods of organisation and financing. With the future of both systems under constant debate, international experience will play a vital role in formulating health system reform strategies.     

Equity in Access to Health Care Services in Italy

ObjectiveTo provide new evidence on whether and how patterns of health care utilization deviate from horizontal equity in a country with a universal and egalitarian public health care system: Italy.ConclusionsDespite its universal and egalitarian public health care system, Italy exhibits a significant degree of SES-related horizontal inequity in health services utilization.     

Assessment and improvement of the Italian healthcare system: first evidence from a pilot national performance evaluation system

The Italian National Health System (NHS), established in 1978, follows a model similar to the Beveridge model developed by the British NHS (Beveridge 1942; Musgrove 2000). Like the British NHS, healthcare coverage for the Italian population is provided and financed by the government through taxes. Universal coverage provides uniform healthcare access to citizens and is the characteristic usually considered the added value of a welfare system financed by tax revenues. Nonetheless, in Italy the strong policy of decentralization, which has been taking place since the early 1990s, has gradually shifted powers from the state to the 21 Italian regions. Consequently, the state now retains limited supervisory control and continues to have overall responsibility for the NHS in order to ensure uniform and essential levels of health services across the country. In this context, it has become essential, both for the ministry and for regions, to adopt a common performance evaluation system (PES). This article reports the definition, implementation, and first evidences of a pilot PES at a national level. It shows how this PES can be viewed as a strategic tool supporting the Ministry of Health (MoH) in ensuring uniform levels of care for the population and assisting regional managers to evaluate performance in benchmarking. Finally, lessons for other health systems, based on the Italian experience, are provided.     

Health centers and health insurance: complements, not alternatives

While some consider health centers and universal health insurance to be opposing concepts, we consider them to be complementary. Health centers play a vital role regardless of the type of insurance system in place because they reduce barriers to care and provide quality culturally competent care to vulnerable populations. The current private employer-based US healthcare system does not create incentives for providers to care for low-income and vulnerable populations. Even in countries with universal health coverage, health centers increase access to care and improve health outcomes. Instead of arguing whether health centers or health insurance should be expanded, the debate should focus on how best to use safety net providers as health insurance coverage expands.     

Growing old before growing rich: inequality in health service utilization among the mid-aged and elderly in Gansu and Zhejiang Provinces, China

ABSTRACT: BACKGROUND: China's recent growth in income has been unequally distributed, resulting in an unusually rapid retreat from relative income equality, which has impacted negatively on health services access. There exists a significant gap between health care utilization in rural and urban areas and inequality in health care access due to differences in socioeconomic status is increasing. We investigate inequality in service utilization among the mid-aged and elderly, with a special attention of health insurance. METHODS: This paper measures the income-related inequality and horizontal inequity in inpatient and outpatient health care utilization among the mid-aged and elderly in two provinces of China. The data for this study come from the pilot survey of the China Health and Retirement Longitudinal Study in Gansu and Zhejiang. Concentration Index (CI) and its decomposition approach were deployed to reflect inequality degree and explore the source of these inequalities. RESULTS: There is a pro-rich inequality in the probability of receiving health service utilization in Gansu (CI outpatient = 0.067; CI inpatient = 0.011) and outpatient for Zhejiang (CI = 0.016), but a pro-poor inequality in inpatient utilization in Zhejiang (CI = -0.090). All the Horizontal Inequity Indices (HI) are positive. Income was the dominant factor in health care utilization for out-patient in Gansu (40.3 percent) and Zhejiang (55.5 percent). The non-need factors' contribution to inequity in Gansu and Zhejiang outpatient care had the same pattern across the two provinces, with the factors evenly split between pro-rich and pro-poor biases. The insurance schemes were strongly pro-rich, except New Cooperative Medical Scheme (NCMS) in Zhejiang. CONCLUSIONS: For the middle-aged and elderly, there is a strong pro-rich inequality of health care utilization in both provinces. Income was the most important factor in outpatient care in both provinces, but access to inpatient care was driven by a mix of income, need and non-need factors that significantly differed across and within the two provinces. These differences were the result of different levels of health care provision, different out-of-pocket expenses for health care and different access to and coverage of health insurance for rural and urban families. To address health care utilization inequality, China will need to reduce the unequal distribution of income and expand the coverage of its health insurance schemes.     

Health reform through tax reform: a primer

Tax incentives for employer-sponsored insurance and other medical spending cost about $200 billion annually and have pervasive effects on coverage and costs. This paper surveys a range of proposals to reform health care, either by adding new tax incentives or by limiting or replacing the existing tax incentives. Replacing the current tax preference for insurance with an income-related, refundable tax credit has the potential to expand coverage and reduce inefficient spending at no net federal cost. But such an approach by itself would entail substantial risks, so complementary reforms to the insurance market are essential to ensure success.     

Horizontal inequity in healthcare access under the universal coverage in Japan; 1986-2007

Universal coverage of healthcare aims at securing access to appropriate healthcare for all at an affordable cost. Since 1961, Japan's national health insurance has provided an equal package of benefits including outpatient, inpatient, dental, and pharmaceutical services. Reduced copayment and other welfare programs are available to the elderly. However, social health insurance may not be a panacea to achieve healthcare for all, especially when facing household impoverishment due to economic stagnation. Using time-series cross-sectional data of a nationally representative survey of Japan, we assessed the degree of inequity in healthcare access in terms of the "equal treatment for equal needs" concept, to identify the impact of changing economic conditions on people's healthcare access. Concentration indices of actual healthcare use (C(M)) and standardized health status as a marker of healthcare needs (C(N)) were obtained. We decomposed C(M) to identify factors contributing to inequalities in healthcare use. Results showed that horizontal inequities in healthcare access in favor of the rich gradually increased over the period with a widening health gap among the poor. The inequality in favor of the rich was specifically observed among people aged 20-64 years, whereas high horizontal equity was achieved among those aged >65 years. Decomposition of C(M) also demonstrated that income and health status were major contributors to widening inequality, which implies that changes in household economic conditions and copayment policy during the study period were responsible for the diminished horizontal equity. Our results suggest that the achievement of horizontal equity through universal coverage should be regarded as an ongoing project that requires continuous redesign of contribution and benefit in the nation's healthcare system.     

Equity in health care access to: assessing the urban health insurance reform in China

This study evaluates changes in access to health care in response to the pilot experiment of urban health insurance reform in China. The pilot reform began in Zhenjiang and Jiujiang cities in 1994, followed by an expansion to 57 other cities in 1996, and finally to a nationwide campaign in the end of 1998. Specifically, this study examines the pre- and post-reform changes in the likelihood of obtaining various health care services across sub-population groups with different socioeconomic status and health conditions, in an attempt to shed light on the impact of reform on both vertical and horizontal equity measures in health care utilization.Empirical estimates were obtained in an econometric model using data from the annual surveys conducted in Zhenjiang City from 1994 through 1996. The main findings are as follows. Before the insurance reform, the likelihood of obtaining basic care at outpatient setting was much higher for those with higher income, education, and job status at work, indicating a significant measure of horizontal inequity against the lower socioeconomic groups. On the other hand, there was no evidence suggesting vertical inequity against people of chronic disease conditions in access to care at various settings. After the reform, the new insurance plan led to a significant increase in outpatient care utilization by the lower socioeconomic groups, making a great contribution to achieving horizontal equity in access to basic care. The new plan also has maintained the measure of vertical equity in the use of all types of care. Despite reform, people with poor socioeconomic status continue to be disadvantaged in accessing expensive and advanced diagnostic technologies. In conclusion, the reform model has demonstrated promising advantages over pre-reform insurance programs in many aspects, especially in the improvement of equity in access to basic care provided at outpatient settings. It also appears to be more efficient overall in allocating health care resources by substituting outpatient care for more expensive care at emergency or inpatient settings.     

The decision-making process of health care utilization in Mexico

Using individual-level data from the 2000 Mexican Survey of Satisfaction with Health Services we estimate a two-part negative binomial hurdle model to evaluate the decision-making process of health care utilization in Mexico. We find that there are income-related differences in utilization associated with the first visit to a physician, as well as substantial utilization differences by region, employment, insurance and financial status. There are also income-related differences in the first visit to a specialist but not in the number of days hospitalized. The results suggest that increasing initial access to services via income and insurance coverage and providing financial resources to underserved regions can substantially improve access to care and, ultimately, population health.     

National health insurance reform in South Africa

Background

A recent health reform proposal in South Africa proposes universal access to a comprehensive package of healthcare services in the public sector, through the implementation of a national health insurance (NHI) scheme. Implementation of the scheme is likely to involve the introduction of a payroll tax. It is implied that the introduction of the payroll tax will significantly reduce the size of the private health insurance market.

Objective

The objective of this study was to estimate the impact of an NHI payroll tax on the demand for private health insurance in South Africa, and to explore the broader implications for health policy.

Methods

The study applies probit regression analysis on household survey data to estimate the change in demand for private health insurance as a result of income shocks arising from the proposed NHI.

Results

The introduction of payroll taxes for the proposed NHI was estimated to result in a reduction to private health insurance membership of 0.73%. This suggests inelasticity in the demand for private health insurance. In the literature on the subject, this inelasticity is usually due to quality differences between alternatives. In the South African context, there may be other factors at play.

Conclusion

An NHI tax may have a very small impact on the demand for private health insurance. Although additional financial resources will be raised through a payroll tax under the proposed NHI reform, systemic problems within the South African health system can adversely affect the ability of the NHI to translate additional finances into better quality healthcare. If these systemic challenges are not adequately addressed, the introduction of a payroll tax could introduce inefficiencies within the South African health system.     

Differences in income-related inequality and horizontal inequity in ambulatory care use between rural and non-rural areas: using the 1998-2001 U.S. National Health Interview Survey data

Background

To better understand income-related inequalities in health care use, it is imperative to identify sources of inequalities and assess the extent to which health care use is still related to income after differences in need across the income distribution are accounted for. Little is known regarding rural-urban differences in income-related inequalities and subgroup variation in horizontal inequities in health care use. This study decomposes income-related inequalities in ambulatory care use into contributions of need and non-need factors and compares horizontal inequities of subgroups in rural and non-rural areas.

Methods

This analysis used non-elderly adult samples from the 1998 to 2001 U.S. National Health Interview Survey data. The area of residence was categorized as rural for non-Metropolitan Statistical Area (MSA) and non-rural for MSA. Concentration indices of ambulatory care use were used to gauge income-related inequalities and decomposed into contributing factors. Horizontal inequities were measured using two methods and the results were compared.

Results

Ambulatory care use was disproportionately concentrated in the poor before need adjustment. However, the results of decomposition and horizontal inequity analyses indicate that the pro-poor concentration of health care use was due to greater health care need in low-income groups. Adjusting for need, ambulatory care use was distributed favoring the better-off, to a larger degree in non-rural areas. Health-related variables were the major contributors to income-related inequalities. Non-need factors, including socioeconomic factors, health insurance, and usual source of care, also contributed to income-related inequalities. There were variation in determinants' contributions to income-related inequalities between rural and non-rural populations and subgroup differences in horizontal inequities. Horizontal inequities were greater within non-whites, high school graduates, individuals with private health insurance, and those without a usual source of care with some geographic variation.

Conclusions

Our analysis shows that seemingly pro-poor income-related inequalities in ambulatory care use were largely due to greater health care need among low-income groups. The results demonstrate different contributions of determinants to income-related inequalities and variation in horizontal inequities by subgroup and locale. The findings of this study should help identify targets for policy intervention for each rural and non-rural area.

     

Canada: a land of missed opportunity for addressing the social determinants of health

The first 25 years of universal public health insurance in Canada saw major reductions in income-related health inequalities related to conditions most amenable to medical treatment. While equity issues related to health care coverage and access remain important, the social determinants of health (SDH) represent the next frontier for reducing health inequalities, a point reinforced by the work of the World Health Organization's Commission on Social Determinants of Health. In this regard, Canada's recent performance suggests a bleak prognosis. Canada's track record since the 1980s in five respects related to social determinants of health: (a) the overall redistributive impact of tax and transfer policies; (b) reduction of family and child poverty; (c) housing policy; (d) early childhood education and care; and (e) urban/metropolitan health policy have reduced Canada's capacity to reduce existing health inequalities. Reasons for this are explored and means of advancing this agenda are outlined.     

The horizontal equity of health care in New Zealand

OBJECTIVE: Given that 'equal access for equal need' is a clearly articulated goal of the New Zealand public health system, this study is an attempt to determine if access to public health care services in New Zealand is, for people of equal health need, independent of income. METHOD: Information on health status, income and health service utilisation for just over 6,000 New Zealanders was obtained from the national Household Health Survey 1992-93. Using standardised expenditure concentration curves and a concentration index, the distribution of health service use by individuals in different income groups, as a proxy for access, was illustrated and quantified. RESULTS: The results suggest either appropriate or slightly excess use of services by the poor given their estimated health need. Due to analytical problems caused by data deficiencies, these results must be regarded as tentative. CONCLUSION: For the period under study, no evidence was found to indicate significant access barriers to publicly funded health care for people on different incomes. This study has served to demonstrate one approach to measuring inequality and analysing the relationship between inequality and inequity. Given the reforms to the health sector since 1993, ongoing monitoring of equity of access to health care services is essential. IMPLICATIONS: Given the income-related disparities in health that do exist, the public health community should endeavour to develop techniques to monitor the delivery of publicly funded health care to ensure that further inequity is not borne by the poor.     

Equity in the delivery of health care in Europe and the US

This paper presents a comparison of horizontal equity in health care utilization in 10 European countries and the US. It does not only extend previous work by using more recent data from a larger set of countries, but also uses new methods and presents disaggregated results by various types of care. In all countries, the lower-income groups are more intensive users of the health care system. But after indirect standardization for need differences, there is little or no evidence of significant inequity in the delivery of health care overall, though in half of the countries, significant pro-rich inequity emerges for physician contacts. This seems to be due mainly to a higher use of medical specialist services by higher-income groups and a higher use of GP care among lower-income groups. These findings appear to be fairly general and emerge in countries with very diverse characteristics regarding access and provider incentives.     

Socioeconomic inequalities in health care utilisation in Norway: the population-based HUNT3 survey

ABSTRACT: BACKGROUND: In this study we investigated the distribution of self-reported health care utilisation by education and household income in a county population in Norway, in a universal public health care system based on ideals of equal access for all according to need, and not according to wealth. METHODS: The study included 24,147 women and 20,608 men aged 20 years and above in the third Nord-Trondelag Health Survey (HUNT 3) of 2006--2008. Income-related horizontal inequity was estimated through concentration indexes, and inequity by both education and income was estimated as risk ratios through conventional regression. RESULTS: We found no overall pro-rich or pro-educated socioeconomic gradient in needs-adjusted utilisation of general practitioner or inpatient care. However, we found overall pro-rich and pro-educated inequity in utilisation of both private medical specialists and hospital outpatient care. For these services there were large differences in levels of inequity between younger and older men and women. CONCLUSION: In contrast with recent studies from Norway, we found pro-rich and pro-educated social inequalities in utilisation of hospital outpatient services and not only private medical specialists. Utilisation of general practitioner and inpatient services, which have low access threshold or are free of charge, we found to be equitable.     

Horizontal equity in utilisation of care and fairness of health financing: a comparison of micro-health insurance and user fees in Rwanda

This paper uses two methods to compare the impact of health care payments under insurance and user fees. Concentration indices for insured and uninsured groups are computed following the indirect standardisation method to evaluate horizontal inequity in utilisation of basic health care services. The minimum standard approach analyses the extent to which out-of-pocket health spending contributed to increased poverty. The analysis uses cross-sectional household survey data collected in Rwanda in 2000 in the context of the introduction of community-based health insurance. Results indicate that health spending had a small impact on the socio-economic situation of uninsured and insured households; however, this is at the expense of horizontal inequity in utilisation of care for user-fee paying individuals who reported significantly lower visit rates than the insured.     

Is variation management included in regional healthcare governance systems? Some proposals from Italy

The Italian National Health System, which follows a Beveridge model, provides universal healthcare coverage through general taxation. Universal coverage provides uniform healthcare access to citizens and is the characteristic usually considered the added value of a welfare system financed by tax revenues.