1887

OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

Health Care Reform in the United States

In spite of improvements, on various measures of health outcomes the United States appears to rank relatively poorly among OECD countries. Health expenditures, in contrast, are significantly higher than in any other OECD country. While there are factors beyond the health-care system itself that contribute to this gap in performance, there is also likely to be scope to improve the health of Americans while reducing, or at least not increasing spending. This paper focuses on two factors that contribute to this discrepancy between health outcomes and health expenditures in the United States: inequitable access to medical services and subsidized private insurance policies; and inefficiencies in public health insurance. It then suggests two sets of reforms likely to improve the US health-care system. The first is a package of reforms to achieve close to universal health insurance coverage. The second set of reforms relates to payment methods and coverage decisions within the Medicare programme to realign incentives and increase the extent of economic evaluation of different medical procedures.

English

Keywords: health expenditure, tax exclusion, adverse selection, Medicare, mandate, Medicare advantage, comparative effectiveness, health oucomes, health status, pooling, individual market, health subsidies, health costs, life expectancy, moral hazard
JEL: H51: Public Economics / National Government Expenditures and Related Policies / National Government Expenditures and Health; O57: Economic Development, Innovation, Technological Change, and Growth / Economywide Country Studies / Comparative Studies of Countries; I12: Health, Education, and Welfare / Health / Health Behavior; C23: Mathematical and Quantitative Methods / Single Equation Models; Single Variables / Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
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