The cost to the New Zealand Government of providing 'free' primary medical care: an estimate based upon the Rand Health Insurance Experiment.
OBJECTIVE
To estimate the likely cost to the New Zealand Government of providing universally free primary medical care.


METHODS
Estimates of current government expenditure on various categories of health were obtained from Ministry of Health sources. Information from the Rand Health Insurance Experiment was used to estimate the changes in demand for general practitioner (GP) visits, pharmaceutical, laboratory and other referred services, and hospital services. The effects of a supplier response and complement (pharmaceutical) prices were also considered.


RESULTS
Assuming that GPs act to control their patients' increasing demand for services, providing free primary care to all New Zealanders is likely to cost the Government between 435 million dollars and 592 million dollars (based upon 1998/99 year data).


CONCLUSIONS
The difficulties and likely inexactness in making estimates of this sort are acknowledged; however, when considering such important changes in health policy, it is important to attempt to define likely costs (and benefits). Consideration of costs must go beyond simply estimating current private expenditure on primary medical care.
Robinson
Tom
T
thomas.robinson@xtra.co.nz
D000328:Adult; D002648:Child; D017047:Cost Sharing; D005194:Family Practice / Q000191:economics; D017048:Health Care Costs; D006291:Health Policy / Q000191:economics*; D006296:Health Services / Q000191:economics / Q000706:statistics & numerical data; D006801:Humans; D017059:Models, Econometric; D009520:New Zealand; D011320:Primary Health Care / Q000191:economics* / Q000706:statistics & numerical data; D013222:State Medicine / Q000191:economics*