Thailand has experienced high growth of health care expenditure with economic growth. Gross Domestic Products (GDP) increased from 662 billion Baht in 1980 to 5,100 billion Baht in 2000. With economic successful, health care expenciture also increased from 25.31 billion Baht in 1980 to 298.45 billion Baht in 2000 Wigh regard to source of health expenditure, public sector contributes only 33.09%, while private sector has big share of 66.77% especially, household & employers spent 64.3% of total health expenditure. While provincial data of health care spending of household indicates that provincial differences of health expenditure reaches 14.18 times at maximum in 2000. This is much bigger than the provincial differences of income which is 5.57 times. This suggests the analysis of health care expenditure is important. Therefore, this study will analyze the determinants of health care expenditure by using aggregated data of household survey at provincial level in 1998 and 2000. Results show income is the primary to determine health care expenditure and find health care is revealed as a "luxury good". Income elasticity of health care is 1.287 in 1998 and 1.132 in 2000. The results excess 1.0 and are different from the one in literature review which estimate income elasticity in a country and results are less than 1.0. As for other factors to affect health care expenditure, the elderly has a positive impact while female has negative impact on health care expenditure. Another finding is accessibility to hospital has positive effect on health care expenditure, but there is no significant effect of other supply factors, for example, the number of physician and bed. It is found out that urbanization and BKK dummy are also influencing health care expenditure negatively in 1998. This might suggest the impact of economic crisis in 1997 is more severe in urban area than rural area or provinces.
