How Much Might Universal Health Insurance Reduce Socioeconomic Disparities in Health? A Comparison of the US and Canada

Sandra L. Decker, Dahlia K. Remler

NBER Working Paper No. 10715
Issued in August 2004
NBER Program(s):Health Economics

A strong association between lower socioeconomic status (SES) and worse health-- the SES-health gradient-- has been documented in many countries, but little work has compared the size of the gradient across countries. We compare the size of the income gradient in self-reported health in the US and Canada. We find that being below median income raises the likelihood that a middle aged person is in poor or fair health by about 15 percentage points in the U.S., compared to less than 8 percentage points in Canada. We also find that the 7 percentage point gradient difference between the two countries is reduced by about 4 percentage points after age 65, the age at which the virtually all U.S. citizens receive basic health insurance through Medicare. Income disparities in the probability that an individual lacks a usual source of care are also significantly larger in the US than in Canada before the age of 65, but about the same after 65. Our results are therefore consistent with the availability of universal health insurance in the U.S, or at least some other difference that occurs around the age of 65 in one country but not the other, narrowing SES differences in health between the US and Canada.

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Document Object Identifier (DOI): 10.3386/w10715

Published: Decker, Sandra L. and Dahlia K. Remler. “How Much Does Universal Health Insurance Reduce Socioeconomic Disparities in Health? A Comparison of the US and Canada.” Applied Health Economics and Health Policy 3, 4 (2005): 205-216.

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