Investigators: Dr Thomas Buchmueller, Prof Denise Doiron, Prof Randall Ellis, Prof Denzil Fiebig, A/Prof Glenn Jones, Dr Meliyanni Johar, Prof Elizabeth Savage (CI). The overall goal of this project is to provide a detailed analysis of the equity and efficiency of current health insurance subsidies. In order to reach this stage a number of procedures will be undertaken. Researchers will first estimate models of total individual health expenditure risk by using a unique dataset, which links 45 and Up survey data with a panel of detailed records on medical services, pharmaceuticals and hospital admissions. A system of separate risk equations for medical, pharmaceutical and hospital expenditures will then be devised in order to investigate substitution across programs. The research team will also determine the extent of deviations between current health care subsidies and predicted risk-related subsidies and identify how they are distributed across the population. This will allow them to simulate the impacts on resource allocation of alternative subsidies.