title: Premium subsidies and social health insurance: substitutes or complements?
abstract: Premium subsidies have been advocated as an alternative to social health insurance. These subsidies are paid if expenditure on health insurance exceeds a given share of income. In this paper, we examine whether this approach is superior to social health insurance from a welfare perspective. We show that the results crucially depend on the correlation of health and productivity. For a positive correlation, we find that combining premium subsidies with social health insurance is the optimal policy.
authors.affiliation: Universität Hamburg, Fachbereich Sozialökonomie, Von-Melle-Park 5, 20146 Hamburg, Germany. mathias.kifmann@wiso.uni-hamburg.de
authors.forename: Mathias
authors.initials: M
authors.lastname: Kifmann
authors.forename: Kerstin
authors.initials: K
authors.lastname: Roeder
mesh_terms: D005249:Fees and Charges; D005380:Financing, Government / Q000191:economics*; D005102:Health Expenditures; D006801:Humans; D007182:Income; D019458:Insurance Coverage / Q000191:economics*; D007348:Insurance, Health / Q000191:economics*; D017057:Medically Uninsured; D018803:Models, Economic; D012943:Social Security / Q000191:economics*; D013557:Switzerland; D013660:Taxes; D014481:United States