Abstract
Health expenditure model This report presents the findings of the research "Health Expenditure Model" which consists of a review of related literature and the health expenditure model. The review of related research work identifies 3 groups of study on health care expenditures: group A measures and estimates health care expenditures of countries by developing national health accounts (NHA) showing sources of financing for health care. Group B analyzes the difference in health care expenditures among countries at a macro level, utilizing regression analysis of cross section data. The findings from such studies using data of developed countries indicate that national income is the most important factor determining aggregate health care expenditures. Group C studies health expenditures at a micro level, using cross section data from surveys of household income and expenditures in a regression analysis to find the relationship between household health care expenditures and household income and other socio-economic variables. It is found that income is not a very important determinant of household health care expenditures as in the macro study.When comparing the 3 groups of studies, it can be concluded that group A or NHA studies can identify the size of the society's resources used in health activities either in the public or the private sector, in consumption or investment, but it provides a picture at a certain point in time. It does not serve as a tool for forecasting future health expenditures, nor for explaining the changes in health expenditures resulting from external factors and government interventions. Studies in Group B which construct a model and use a regression analysis can provide an explanation of factors determining health expenditures and of differences in health expenditures among countries, but they cannot say much about health policy directions and health budget determination. Group C studies on household health care expenditures are studies at a micro level which derive different findings and conclusions from those derived from a micro study.When comparing the 3 groups of studies, it can be concluded that group A or NHA studies can identify the size of the society's resources used in health activities either in the public or the private sector, in consumption or investment, but it provides a picture at a certain point in time. It does not serve as a tool for forecasting future health expenditures, nor for explaining the changes in health expenditures resulting from external factors and government interventions.
