Understanding Cross-Country Differences in Health Status and Expenditures: Health Prices Matter

Healthcare spending varies widely across nations. While the U.S. spends significantly more on healthcare than many European countries, it does not always translate to better health outcomes. Americans often report poorer health and shorter lifespans compared to Europeans.

This study focuses on understanding the reasons behind these disparities. It argues that differences in healthcare prices are a primary driver. By building a model that considers factors like healthcare provision, production technology, health risks, and insurance coverage, I identify significant price gaps between the U.S. and European countries.

I find that U.S. healthcare prices are substantially higher than the European average. If the U.S. had European-level prices, its healthcare spending gap would be significantly smaller, and more people would enjoy better health. Factors like competition, quality incentives, regulation, and administrative costs influence these price differences. Additionally, health risks related to lifestyle choices also contribute to variations in spending and outcomes.

I highlight the welfare costs associated with higher healthcare prices in the U.S. Understanding these factors is crucial for policymakers aiming to improve healthcare affordability and outcomes.


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Contact:

Thepthida Sopraseuth

Thepthida.sopraseuth@cyu.fr

http://thepthida.sopraseuth.free.fr/

 

Affiliated/Collaborating Laboratories:

Coauthors

Raquel Fonseca, Université du Québec à Montréal, Centre interuniversitaire de recherche en analyse des organisations (CIRANO), and RAND

François Langot, Le Mans University, Institut Universitaire de France, Paris School of Economics, Centre pour la recherche économique et ses applications, and Institute of Labor Economics

Pierre-Carl Michaud, HEC Montreal, CIRANO, and National Bureau of Economic Research

Link to the laborator'y page