Abstract

Major political parties remain publicly committed to Medicare and community-ratedvoluntary health insurance. It is important to understand the future financialconsequences of this policy in order to assist community debate about whether sucha commitment is appropriate or some other policy should be developed.This paper describes development of, and results from, the APHA health financingmodel. It suggests that health expenditure would represent 12.9percent; of gross domesticproduct by 2021, compared to 8.5percent; in 1995. Increasing per capita expenditureis the major contributor to the growth, with demographic changes responsible foronly 14.3percent;.