How Aging Population Affects Health Care Expenditures in Pakistan? A Bayesian VAR Analysis
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How Aging Population Affects Health Care Expenditures in Pakistan? A Bayesian VAR Analysis Usman Shakoor1 · Mudassar Rashid1 · Ashfaque Ali Baloch1 · Muhammad Iftikhar ul Husnain1 · Abdul Saboor2 Accepted: 19 September 2020 © Springer Nature B.V. 2020
Abstract The changing population structure has raised serious concerns about future health care expenditures in Pakistan. Growing proportion of aged people could lead to a higher health care expenditure as occurrence of chronic-degenerative diseases increases and a large demand for health and social care is visualized with a subsequent effect on health expenditures. Considering the above research problem, the current study analyzed the effects of ageing population on health care expenditures in Pakistan using a time-series data from period 1995 to 2014. Bayesian VAR approach was applied to evaluate the impacts of population ageing on health care expenditures. From the results of the study it was clear that health expenditure of Pakistan showed more response towards aged population as compared to life expectancy and per capita GDP. Population aging brought about 2.6 percent increase in health care expenditures and are expected to rise to 17.2 percent in tenth year when compared to the base year. Life expectancy also brought an increase in healthcare expenditure; bringing about 3.6 percent increase in health care expenditures per capita and 14.2 percent increase in tenth year. Real GDP per capita explains 1.7 percent fluctuation in health care expenditures per capita in third year which increases to 3 percent in tenth year. A macro level dedicated health policy for elderly people could help to minimize the health care expenditures such as, training of primary care doctors in geriatrics and provision of domiciliary care. Ageing population illnesses that give hike to health care expenditure should be considered for further research to get more truthful outcomes. Keywords Ageing · Health care expenditures · Bayesian VAR · Impulse response · Variance decomposition
1 Introduction Between 2015 and 2030, the number of people aged sixty years or above will increase by 56 per cent, from 901 million to 1.4 billion in the world, and older person’s numbers will exceed the population of children aged 0–9 years (1.4 billion against 1.3 billion). * Usman Shakoor [email protected] Extended author information available on the last page of the article
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Approximately 56 percent of the total global ageing population was living in Asia in 2015. Asia’s share in the world’s older population is expected to grow to 60 percent by 2030 and will reach to 62 percent by 2050 United Nations (2015). Population ageing is considered as a result of demographic shift from a high to low level of mortality and decreased fertility rates combined with increase in life expectancy, due to the advancements in health sector and family planning methods Bloom and Luca (2016). Increase in ageing population seems to be a major future challenge for the worl
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