Scandinavian Working Papers in Economics

SSE/EFI Working Paper Series in Economics and Finance,
Stockholm School of Economics

No 116: Equity in Health Care Utilisation: Further Tests Based on Hurdle models and Swedish Micro Data

Ulf-G. Gerdtham ()
Additional contact information
Ulf-G. Gerdtham: Centre for Health Economics, Postal: Stockholm School of Economics, Box 6501, 113 83 Stockholm, Sweden

Abstract: This paper tests the null hypothesis of no horisontal inequity in delivery of health care by use of count data Hurdle models and swedish micro data. It differs from most earlier work in three principal ways: First, the tests are carried out separately for physician and hospital care; second, the tests are carried out separately for the probability of seeking care and the amount of care received (given any use); and third, the tests are based on a model that includes several socioeconomic variables; e.g. income, education and size of community of residence. Most earlier work on testing for inequity has restricted attention to the bvivariate relationship between income and health care utilisation (standardized for need=morbidity). The paper concludes that need, proxied by morbidity, has a significant positive effect on health care utilisation. Despite this, it rejects the hypothesis of no inequity because socioeconomic factors also have significant effects on utilisation; e.g., income and size of community of residence. Income has a significant positive effect on the probability of visiting a physician but not on the frequency of physician visits. size of community of residence has a positive significant effect on the frequency of physician visits but not on the probability of visiting a physician. This latter finding is interpreted as evidence of departure from equity, as a result of supplier-induced demand.

Keywords: Equity; health care; count data; maximum likelihood estimation

JEL-codes: C30; D63

34 pages, June 1996

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