Do Health Expenditures Converge Among ASEAN Countries?

Area of Science:

• Health Economics
• Econometrics
• Public Policy

Background:

• Health expenditure trends are crucial for economic development and public health.
• Understanding convergence patterns in health spending among Association of Southeast Asian Nations (ASEAN) countries is vital for regional policy.
• Wagner's Law posits that national income growth leads to increased public expenditure.

Purpose of the Study:

• To investigate the convergence of public and private health expenditures in ASEAN member states.
• To analyze the long-term trends and patterns of health spending across diverse economies within the ASEAN region.

Main Methods:

• The study employed the SPSM procedure and panel KSS unit root tests.
• Econometric analysis was used to assess the stationarity and convergence of health expenditure data.

Main Results:

• Public health expenditures (PUHE) are converging in Indonesia, Lao PDR, Cambodia, the Philippines, and Myanmar, but diverging in Brunei Darussalam, Malaysia, Vietnam, Singapore, and Thailand.
• Private health expenditures (PRHE) demonstrate stationarity, indicating convergence across all ASEAN member states.
• Findings align with Wagner's Law, showing a tendency for countries with lower PUHE to increase spending, aiming to match higher-spending nations.

Conclusions:

• The convergence of private health expenditures suggests a uniform trend in out-of-pocket spending across ASEAN.
• Divergence in public health spending highlights varying national priorities and capacities within the region.
• Low- and lower-middle-income countries should prioritize increasing public health expenditures to enhance healthcare accessibility for all citizens.