Progressivity, horizontal equity and reranking in health care finance: a decomposition analysis for the Netherlands

Abstract

This paper employs the method of Aronson et al. (1994) to decompose the redistributive effect of the Dutch health care financing system into three components: a progressivity component, a classical horizontal equity component and a reranking component. Results are presented for the health care financing system as a whole, as well as for its constituent parts. A final section sets out to uncover the relative importance (in terms of their effects on progressivity, horizontal equity and reranking) of the key institutional features of one component of the Dutch system -the AWBZ social insurance scheme. © 1997 Elsevier Science B.V.

Reflections on and alternatives to WHO's fairness of financial contribution index

“…that not due to progressivity) is due to re-ranking rather than horizontal inequity. This is consistent with the results for out-of-pocket payments in the Netherlands reported in [27]. Also of note in Table 1 are the reductions in the values of H and R. The percentage reduction in H is larger, so that re-ranking accounts for an even larger share of the additional RE in 1998.…”

“…Such an approach is provided by the decomposition framework proposed by Aronson et al [25] in the early 1990s, and used in the health finance literature in the late 1990s [27,28]. In this framework fairness is assessed explicitly in terms of the impact of health care financing on the distribution of income, since this is, after all, the ultimate concern amongst policymakers when they think about financial protection.…”

“…Two OECD studies were undertaken in the late 1990s [27,28] using the AJL method to decompose the RE of health care financing into components corresponding to a 'rate effect' (the share of income spent on health care), a progressivity component indicating what progressivity would have been in the presence of a horizontally equitable financing system, a horizontal inequity component, and a re-ranking component. Separating out progressivity from horizontal inequity is attractive because different policy responses are implied by each.…”

Income-Based Drug Coverage in British Columbia: The Impact on the Distribution of Financial Burden

“…It should be noted that private payments for healthcare are consistently found to be regressive in all manner of financing arrangements, stemming in part from higher rates of illness and consumption of medical care among those with lower incomes (Wagstaff et al 1992;Wagstaff and van Doorslaer 1997;van Doorslaer et al 1999;Castano et al 2002). However, the increase in private expenditures among both senior and nonsenior households of lower income is surprising given that the policy was specifically designed to protect low-income seniors and improve coverage for lower-income nonseniors.…”

Guatemala: The economic burden of illness and health system implications

“…The LSMS data is used to estimate health and consumption spending as well as examine variables indicating access to health care. We began by estimating the share of different income groups in health financing, using a version of the methods used in Wagstaff and Doorslaer [14], Wagstaff et al [15] and Doorslaer et al [16] to gauge the ex ante distribution of the burden of health spending. For this purpose, we used information from the National Health Accounts for Guatemala, estimates of the distribution of out of pocket payments and premiums for private insurance and IGSS paid by (or on behalf of) households in different income groups using LSMS data, and an assessment of the share of households belonging to different income groups in general tax revenues to arrive at the ex ante burden in health financing.…”