IDEAS home Printed from https://ideas.repec.org/a/aea/aejpol/v7y2015i4p41-70.html

The Effects of Medicare on Medical Expenditure Risk and Financial Strain

Author

Listed:
  • Silvia Helena Barcellos
  • Mireille Jacobson

Abstract

Medicare offers substantial protection from medical expenditure risk, protection that has increased in recent years. At age 65, out-of-pocket expenditures drop by 33 percent at the mean and 53 percent at the ninety-fifth percentile. Medical-related financial strain, such as difficulty paying bills and collections agency contact, is dramatically reduced. Nonetheless, using a stylized expected utility framework, the gain from reducing out-of-pocket expenditures accounts for only 18 percent of the social costs of financing Medicare. This calculation ignores any direct health benefits from Medicare or any indirect health effects due to reductions in financial stress. (JEL D14, H51, I13, I18, J14)

Suggested Citation

  • Silvia Helena Barcellos & Mireille Jacobson, 2015. "The Effects of Medicare on Medical Expenditure Risk and Financial Strain," American Economic Journal: Economic Policy, American Economic Association, vol. 7(4), pages 41-70, November.
    • Handle: RePEc:aea:aejpol:v:7:y:2015:i:4:p:41-70
    Note: DOI: 10.1257/pol.20140262
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/pol.20140262
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/pol/app/0704/2014-0262_app.pdf
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/pol/data/0704/2014-0262_data.zip
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/pol/ds/0704/2014-0262_ds.zip
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    ---><---

    Other versions of this item:

    More about this item

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejpol:v:7:y:2015:i:4:p:41-70. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.