Understanding international measures of health spending
Age-adjusting expenditure on health
Assessing health system performance over time or across countries often means comparing
populations with very different characteristics, including age structure. The share
of the population aged 65 years and over ranges from less than 1 in 10 in some of
the Latin American countries of the OECD to almost 3 in 10 in Japan. At the same time,
populations are aging rapidly - on average across the OECD, there are 20% more people
over 65 since 2015. Since risk of illness and ill-health generally increases with
age, a population with an older demographic structure can expect higher mortality
rates, greater incidence and prevalence of certain diseases, and thus higher demands
for healthcare and, by consequence, higher spending on health. This working paper
argues that the level of health spending depends not only on the size of the population
(among other factors), but also on the demographic structure of the population. The
paper reviews the international literature on age-adjusting health spending, and examines
three methods of age-adjustment to report and compare health expenditure data between
OECD countries and over time.
Published on October 31, 2023
In series:OECD Health Working Papersview more titles