A decomposition of income-related health inequality applied to EQ-5D

Abstract

Income-related inequality in health and its relationship to sociodemographic characteristics have received considerable attention in the health economic literature. Recently a method was suggested for decomposing income-related health inequality to contributions from individual characteristics via additive dimensions, and this was applied to a Finnish case based on 15D health scores, where health is considered to be a sum of 15 individual health dimensions. The present study adds to this literature in several ways. First, we apply the decomposition approach to a Danish case which can be benchmarked to the Finnish. Second, we show how to apply the method to EQ-5D scores, which deviate from 15D scores by expressing health as individual depreciations of an equal endowment of perfect health. Third, we add life-style factors to the determinants of income-related health inequality. The empirical part of the study reveals discrepancies which can be attributed to differences between Finland and Denmark and to differences between the construction of 15D and EQ-5D scores. Finally, evidence of impact of life-style factors on income-related health inequality is found.