The Distribution of Public Spending for Health Care in the United States on the Eve of Health Reform

Didem Bernard, Thomas Selden, Yuriy Pylypchuk

Chapter in NBER book Measuring and Modeling Health Care Costs (2018), Ana Aizcorbe, Colin Baker, Ernst R. Berndt, and David M. Cutler, editors (p. 459 - 474)
Conference held October 18-19, 2013
Published in February 2018 by University of Chicago Press
© 2018 by the National Bureau of Economic Research
in NBER Book Series Studies in Income and Wealth

U.S. health care spending in 2012 totaled $2.8 trillion or 17.2 percent of gross domestic product. Given the magnitude of health care spending, the large public sector role in health care, and the reforms being implemented under the Patient Protection and Affordable Care Act (ACA), we believe it useful to examine several basic questions: What was the public share of national spending on the eve of reform? How has the public share evolved over time? And how are the benefits of public spending on health care distributed within the population by age, poverty level, insurance coverage, health status, and ACA-relevant subgroups? The questions we pose, while basic, cannot be answered with commonly-available statistics due to the sheer complexity of health care financing in the U.S. The objective of this paper is to provide answers by combining aggregate measures from the National Health Expenditure Accounts with micro-data from the Medical Expenditure Panel Survey.

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This chapter first appeared as NBER working paper w23150, The Distribution of Public Spending for Health Care in the United States on the Eve of Health Reform, Didem Bernard, Thomas Selden, Yuriy Pylypchuk
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