Redistributive Effects of the Swedish Health Care Financing System

The paper investigates the redistributive effects of the Swedish health care financing system in 1980 and 1990 for four different financial sources: County council taxes, payroll taxes, direct payments and state grants. The redistributive effects are decomposed into vertical, horizontal and reranking segments for each of the four financial sources. The data used in this study is based on probability samples of the Swedish population, the Level of Living Survey (LNU) from 1981 and 1991. The paper concludes that the Swedish health care financing system is weakly progressive, although direct payments are regressive. There are some horizontal inequity and reranking, which mainly comes from the county council taxes, since those tax rates vary for each county councils. The implication is that, to some extent, people with equal income are treated unequally