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The Effect of Prescription Drug Coverage on Mortality: Evidence from Medicaid Implementation

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  • Clayton, Denise Hammock

Abstract

This paper estimates the effect of Medicaid prescription drug spending on mortality. I use the group- and state-specific roll out of Medicaid drug coverage to isolate plausibly exogenous variation in drug expenditures. I find that a $1 increase in Medicaid drug expenditures per resident reduces mortality from internal causes by 2.0 deaths per hundred thousand, a decline of 0.23%. I find relatively large effects for: (1) medically-treated diseases which pose an immediate risk of death, (2) impoverished areas which received a disproportionate share of state Medicaid dollars, and (3) areas with a high ratio of medical to surgical physicians.

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  • Clayton, Denise Hammock, 2019. "The Effect of Prescription Drug Coverage on Mortality: Evidence from Medicaid Implementation," Journal of Health Economics, Elsevier, vol. 63(C), pages 100-113.
    • Handle: RePEc:eee:jhecon:v:63:y:2019:i:c:p:100-113
    DOI: 10.1016/j.jhealeco.2018.10.003
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    Cited by:

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