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Health Trajectories of Older Americans and Medical Expenses: Evidence from the Health and Retirement Study Data Over the 18 Year Period

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  • Serah Shin

    (University of Kentucky)

  • Hyungsoo Kim

    (University of Kentucky)

Abstract

This study investigates the long-term relationship between individuals’ health state changes over time and burdens due to out-of-pocket medical expenses (OOP) in later years. We kept track of 5540 individuals’ health trajectories and their accumulated OOP using the HRS data from 1992 to 2010. American adults between 50 and 70 years old spend on average $27,000 on OOP, and have five common health trajectory patterns (Multi-Morbidity, Co-Morbidity, Mild Disease, Late Event, and No Disease). However, their OOPs differed substantially depending on the pattern of health trajectory. The most costly pattern of Multi-Morbidity needed $18,823 more than the least costly No Disease pattern. Older adults with the most costly pattern spent most of OOP on either prescription drugs or doctor/dental visits. Additionally, we found that the OOP burden of prescription medications was substantially relieved by the Medicare Part D implementation. These findings have several important implications for individuals, financial educators, and policy makers.

Suggested Citation

  • Serah Shin & Hyungsoo Kim, 2018. "Health Trajectories of Older Americans and Medical Expenses: Evidence from the Health and Retirement Study Data Over the 18 Year Period," Journal of Family and Economic Issues, Springer, vol. 39(1), pages 19-33, March.
    • Handle: RePEc:kap:jfamec:v:39:y:2018:i:1:d:10.1007_s10834-017-9542-7
    DOI: 10.1007/s10834-017-9542-7
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    References listed on IDEAS

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    3. Ilona Kwiecien & Anna Jedrzychowska, 2020. "The Child as a Family Asset? The Modelling of the Family' Economic Loss in Case of Premature Child Death," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 98-120.

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