In the past three decades, many developed countries have changed the manner in which hospitals were financed. Although it is been hypothesized that the manner in which healthcare providers are reimbursed may affect their performance (and thereby population health), there is little empirical literature on the impact of these reforms in terms of health care output (costs) and population health (benefits). This study uses panel data on 20 OECD countries for 29 years to explore the impact of these reforms on healthcare outcomes and population health, including national health spending, mortality and hospital utilization measures. We classified hospital financing systems into three categories, a) payment depending solely on hospital characteristics (fixed budget), b) payment based on the quantity of services provided (fee-for-service, FFS) and b) payment based on diagnosis and/or patients characteristics (patient based payment, PBP). We use a difference-in-difference (DID) model, and two of its variations, random trend and differential trend model to analyse the data. The result shows that, relative to a fixed budget, FFS payment method permanently increases the growth rate of hospital inpatient discharges and health care spending, while PBP rarely has a significant impact on health care outcomes. There is no evidence that FFS and PBP directly decrease mortality.