Is Kuwait Overspending on its Healthcare System? Estimating the Optimal Healthcare Expenditure for Single-Payer Healthcare system Countries

Abstract

Despite being one of the most basic needs for any human being, not all countries provide free medical coverage to all their residents, in a matter of fact there are only 32 countries that follow such system which Kuwait is one of them. The universal government-funded health system, also known as single-payer healthcare, is a healthcare system where government funds all healthcare services to all citizens and non-citizens residence regardless of their income or employment status. Some countries may require non-citizens to buy private insurance that is partially subsidized by the government. The aim of this study is to evaluate the factors that mostly affects healthcare expenditure (HE) per capita and based on it estimate HE per capita and compare it to the actual HE per capita to find which countries overspend or underspend on their HE. Using OLS regression that is based on a panel data of 29 countries that follows single-payer healthcare system in 2019 where HE per capita is set as a dependent variable. Results revealed that HE as percentage of GDP, GDP per capita, number of physicians per 1000 persons, and number of hospital beds per 1000 persons all showed statistically significant direct relation with HE per capita while oddly percentage of people aged 65 and above showed a statistically significant inverse relation with HE per capita. Results also showed that corruption and life expectancy did not have any statistically significant relation with HE per capita. Running the estimation model revealed that 6 countries were in the acceptable range, ±5% from forecasted HE, while 12 countries showed overspending and 11 countries were underspending. Cuba showed that it was the most overspending country by +22.26% and Georgia was the most underspending country by -30.80% while Kuwait overspend by +9.90%.