Allocative policies are designed to provide net benefits to some distinct group or class of individuals or organizations at the expense of others to ensure that public objectives are met. Such policies are in essence subsidies through which policymakers seek to alter demand for or supply of particular products and services or to guarantee access to products and services for certain people. For example, on the basis that without subsidies to medical schools, markets would undersupply the preparation of physicians, government has heavily subsidized the medical education system. Similarly, on the basis that markets would undersupply hospitals in sparsely populated regions or low-income areas, government subsidized the construction of hospitals for many years.
Other subsidies have been used to ensure that certain people have access to health services. The most important examples of such policies, based on the magnitude of expenditures, are the Medicare and Medicaid programs. Medicare expenditures exceeded $309 billion in 2005 and could reach $532 billion by 2013; Medicaid expenditures exceeded $319 billion in 2005 and could reach $628 billion by 2013 (Heffler et al. 2004). As noted earlier, Appendixes A and B contain descriptions of the Medicare and Medicaid programs. Additional information about the Medicare program is found at http://research.aarp.org/health/fs103_medicare.html#pdf and at http://www.kff.org/medicare/index.cfm and about the Medicaid program at http://research.aarp.org/health/fs102_medicaid.html and http://www.kff .org/medicaid/index.cfm.
In addition to the massive Medicare and Medicaid allocative policies, federal funding to support access to health services for Native Americans, veterans, and migrant farm workers and state funding for mental institutions are other examples of allocative policies that are intended to assist individuals in gaining access to needed services. Some think of subsidies as reserved for people on the basis oftheir impoverishment. However, subsidies such as those inherent in much ofthe financial support for medical education, the Medicare program (the benefits of which are not based primarily on the financial need of the recipients), and the exclusion from taxable income of employer-provided health insurance benefits illustrate that poverty is not a necessary condition for the receipt of the subsidies available through the allocative category of health policies.
Was this article helpful?
Achieve the Fitness and Wellness for You that you have always wanted by learning the facts so you can take the right steps to maximize your health. Learn How to Achieve Real Fitness and Wellness for a Healthy Body, Mind and Spirit to Improve Your Quality of Life in Today's World. Receive Valuable Information to Discover What Really Matters and What Actually Works in Finding Genuine Wholeness for All Aspects of Your Being.