Do Health Problems Reduce Consumption at Older Ages?

TitleDo Health Problems Reduce Consumption at Older Ages?
Publication TypeReport
Year of Publication2009
AuthorsButrica, BA, Johnson, RW, Mermin, GBT
Series TitleCenter for Retirement Research at Boston College Working Papers
Document NumberWP#2009-9
InstitutionCenter for Retirement Research at Boston College
CityBoston
Call Numbernewpubs20090908_CRR2009-9.pdf
KeywordsHealthcare, Medicare/Medicaid/Health Insurance
Abstract

High out-of-pocket health care costs may have serious repercussions for older people and their families. If their incomes are not sufficient to cover these expenses, older adults with health problems may have to deplete their savings, turn to family and friends for financial help, or forego necessary care. Or they may be forced to reduce their consumption of other goods and services to pay their medical bills. This paper uses data from the Health and Retirement Study (HRS) and the related Consumption and Activities Mail Survey (CAMS) to examine the impact of health problems at older ages on out-of-pocket health care spending and other types of expenditures. The analysis estimates fixed effects models of total out-of-pocket health care spending, out-of-pocket health care spending exclusive of premiums, total spending on all items except health care, and total spending on all items except health care and housing. The models are estimated separately for households ages 65 and older and those ages 51 to 64. The results show that medical conditions increase health spending, particularly for households ages 51 to 64, but that health conditions do not generally reduce nonhealth spending. Medical conditions do, however, reduce nonhealth spending for low-income households ages 51 to 64, suggesting that holes in the health safety net before the Medicare eligibility age force some low-income people to lower their living standards to cover medical expenses.

URLhttps://crr.bc.edu/working-papers/do-health-problems-reduce-consumption-at-older-ages/
Endnote Keywords

HEALTH-CARE COSTS/Medical Expenditures

Endnote ID

20620

Citation Key5744