Out-of-pocket costs and health care : evidence from Australia's Medicare program
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NO FULL TEXT AVAILABLE. Access is restricted indefinitely. ----- Most Australians face low out-of-pocket (OOP) costs for Medicare-funded services. However, in the mid-1990s these costs started to increase, placing pressure on the Commonwealth Government to act. In 2004 the Government introduced the Strengthening Medicare package, designed to reduce the OOP costs for medical services. This thesis examines the impact of OOP costs on the demand for general practice services and on participation in the cervical screening program. The analysis employs panel data econometric techniques, using both survey and administrative data from the Australian Longitudinal Study of Women’s Health. The thesis also examines the impact of the Strengthening Medicare policy; in particular the Medicare Safety Net. Time discontinuity regressions are used to estimate the impact of the Safety Net on provider charges, Medicare benefits, OOP costs and service use. This thesis finds that the increases in OOP cost have had a small but significant impact on the demand for general practice services. The level of response is dependent on income, with poorer sections of the community being more responsive than wealthier sections. The results also show that people in ill health are just as responsive as people who are healthy. In terms of health investment activities, the role of OOP costs is less clear cut. Nevertheless, there is some evidence that individuals who have faced relatively large increases in OOP costs reduce their compliance with recommended cancer screening intervals. The analysis of the Government’s Medicare Safety Net shows that the policy is regressive and has led to an increase in provider charges amongst some medical professions. In turn, this has resulted in a significant amount of leakage of Medicare benefits towards providers’ pockets, rather than patients’ pockets.
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