The 'Red Herring' Hypothesis: Some Theory and New Evidence

Area of Science:

• Health Economics
• Gerontology
• Public Health

Background:

• The 'red herring' hypothesis (RHH) posits that proximity to death, rather than age, is the primary driver of healthcare expenditure (HCE), independent of income and medical technology.
• Existing research provides a foundation, but theoretical underpinning and testing in varied settings, including rationed healthcare systems, are needed.

Purpose of the Study:

• To theoretically underpin the RHH and derive new predictions.
• To test these predictions against published empirical data in both non-rationed and rationed healthcare settings.

Main Methods:

• Derivation of ten predictions using women's longer life expectancy as a proxy for time to death.
• Derivation of 35 predictions related to the age profile of HCE.
• Systematic testing of these predictions against a substantial body of published empirical evidence.

Main Results:

• Predictions based on women's life expectancy showed strong confirmation (7/11 full, 2/11 partial in non-rationed; 12/17 full, 1/17 partial in rationed settings).
• Predictions on HCE age profiles also received significant support (7/12 full, 4/12 partial in non-rationed; 11/23 full, 9/23 partial in rationed settings).
• Overall contradictions were minimal (10 instances), indicating robust empirical backing for the RHH.

Conclusions:

• The study provides substantial empirical support for the RHH across diverse healthcare systems.
• Proximity to death emerges as a more significant determinant of healthcare expenditure than age.
• The findings have implications for understanding healthcare spending patterns and resource allocation.