Health insurance to reduce inequality in France? It works!

Paris, Monday, February 28, 2022-This is a document published by the Bureau of Research, Research, Assessment and Statistics (DREES) that makes it possible to measure the impact of health insurance as a tool to reduce inequality. ..

Health care costs in France account for 8.7% of GDP, and 77.8% of this spending is covered by health insurance. Health insurance operations are based on a simple system. That is, income-based financing and universal benefits differentiated by care and patient. In a naughty way, the two authors of the study Matthew Fouquet and Catherine Pollack link this principle to the Marxist maxim. From each according to the means to each as needed “.

This principle results in double redistribution. The horizontal ones between illness and health, and the lesser-known vertical ones between the rich and the most modest. The Ines-Omar model developed by DRESS was responsible for studying the weight of the public and private factors of the health insurance system on household income in 2017 (after the so-called gradual introduction of 100% health).

€ 5,000 per household

Public health insurance covers an average of € 5,000 per year for medical expenses per household and for reimbursement of medical expenses. Higher numbers in a conservative background (40% of the poorest households average € 6,000, 10% of the richest households € 4,400). This difference is explained by, on average, worse health conditions, especially in the most modest and high proportion of older people in the latter.

Support that is mechanically transformed into the most modest increase in household purchasing power.

Financing to reduce inequality

At the same time, as a compulsory tax system, the health insurance system relies on higher contributions from the wealthiest households. All financial (taxes collected, benefits paid) or in-kind (education, health, etc.) that affect primary income (income from work and income from assets) and alternative income (retirement pension, unemployment) Public health insurance contributes 20% to the reduction of inequality, with the contribution of funding them (such as benefits by taking into account the public transfer of).

This redistribution effect is basically based on the profit added to the disposable income. These represent almost 40% of the poorest 20% disposable income. But as the authors of the study point out: However, it should be noted that the redistribution effect measured here is partially related to the poor health of the low-income group. “.

Of the wealthy households, the rest paid after repayment is significantly higher than in low-income households. These differences are partially offset by higher repayments from complementary health insurance, but the final out-of-pocket costs that directly weigh on the household also increase with living standards.

The premiums paid by households for complementary health insurance policies rise sharply with the standard of living. This, among other things, reflects the existence of income-differentiated pricing, as well as higher guarantees and higher repayments from complementary health insurance.

Disconnected disposable income of the elderly

What is interesting about the study is that the medical costs directly borne by the household (self-paid costs after the intervention of compulsory insurance and supplementary insurance, and supplementary medical insurance premiums) have a large effect on the budget of low-income households in proportion to disposable income. Gives. In addition, the weight of medical costs within the budget increases sharply with age, rising from 2.7% between the ages of 30 and 39 to 8.2% after the age of 80.