Equity effects of private health insurance subsidies: Brazil in international comparison

In healthcare policy, tax subsidies may provoke public underfunding and privatization, encouraging households and employers to buy private health insurance. They may be justified under a plausible criterion recognized among health economists and health policy analysts. These subsidies function as tax relief for taxpayers who believe that there is a reduction in public health spending. They may, however, negatively affect equity principles. Regarding poverty and inequality, in Brazil this question is a national political issue since the elderly and chronically ill will be forced to surrender to public services due to high costs within the private schemes. Moreover, subsidies on healthcare with no limits determine that employers and employees (private agents), not the government, define the federal spending on health care, which raises concerns about the control of fiscal policy.