IDEAS home Printed from https://ideas.repec.org/p/hka/wpaper/2020-004.html
   My bibliography  Save this paper

Medicare and the Geography of Financial Health

Author

Listed:
  • Paul Goldsmith-Pinkham
  • Maxim Pinkovskiy
  • Jacob Wallace

Abstract

We use a five percent sample of Americans' credit bureau data to study the effects of public health insurance on the geography of consumer financial health. Exploiting the (nearly) universal eligibility for Medicare at age 65, we find a 30 percent reduction in debt collections with limited effects on other financial outcomes. Medicare reduces the geographic variation in collections by two-thirds at age 65, and halves the geographic correlation between collections and demographics like race and education. Areas that experienced larger gains in financial health at age 65 had higher shares of black residents, people with disabilities, and for-profit hospitals.

Suggested Citation

  • Paul Goldsmith-Pinkham & Maxim Pinkovskiy & Jacob Wallace, 2020. "Medicare and the Geography of Financial Health," Working Papers 2020-004, Human Capital and Economic Opportunity Working Group.
    • Handle: RePEc:hka:wpaper:2020-004
    Note: MIP
    as

    Download full text from publisher

    File URL: http://humcap.uchicago.edu/RePEc/hka/wpaper/Goldsmith-Pinkham_Pinkovskyi_Wallace_2020_medicare-geography-financial-health.pdf
    File Function: First version, January 15, 2020
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. 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.
    2. Kolstad, Jonathan T. & Kowalski, Amanda E., 2012. "The impact of health care reform on hospital and preventive care: Evidence from Massachusetts," Journal of Public Economics, Elsevier, vol. 96(11), pages 909-929.
    3. Bhashkar Mazumder & Sarah Miller, 2014. "The Effects of the Massachusetts Health Reform on Financial Distress," Working Paper Series WP-2014-1, Federal Reserve Bank of Chicago.
    4. Finkelstein, Amy & McKnight, Robin, 2008. "What did Medicare do? The initial impact of Medicare on mortality and out of pocket medical spending," Journal of Public Economics, Elsevier, vol. 92(7), pages 1644-1668, July.
    5. David Autor & David Dorn & Gordon Hanson, 2019. "When Work Disappears: Manufacturing Decline and the Falling Marriage Market Value of Young Men," American Economic Review: Insights, American Economic Association, vol. 1(2), pages 161-178, September.
    6. Raj Chetty & Nathaniel Hendren & Patrick Kline & Emmanuel Saez, 2014. "Where is the land of Opportunity? The Geography of Intergenerational Mobility in the United States," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(4), pages 1553-1623.
    7. Jeffrey Clemens & Joshua D. Gottlieb, 2017. "In the Shadow of a Giant: Medicare’s Influence on Private Physician Payments," Journal of Political Economy, University of Chicago Press, vol. 125(1), pages 1-39.
    8. Bhattacharya, Jay & Lakdawalla, Darius, 2006. "Does Medicare benefit the poor?," Journal of Public Economics, Elsevier, vol. 90(1-2), pages 277-292, January.
    9. Gross, Tal & Notowidigdo, Matthew J., 2011. "Health insurance and the consumer bankruptcy decision: Evidence from expansions of Medicaid," Journal of Public Economics, Elsevier, vol. 95(7-8), pages 767-778, August.
    10. Cory S. Capps & Dennis W. Carlton & Guy David, 2020. "Antitrust Treatment Of Nonprofits: Should Hospitals Receive Special Care?," Economic Inquiry, Western Economic Association International, vol. 58(3), pages 1183-1199, July.
    11. Charles Courtemanche & James Marton & Benjamin Ukert & Aaron Yelowitz & Daniela Zapata, 2017. "Early Impacts of the Affordable Care Act on Health Insurance Coverage in Medicaid Expansion and Non‐Expansion States," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 36(1), pages 178-210, January.
    12. Frean, Molly & Gruber, Jonathan & Sommers, Benjamin D., 2017. "Premium subsidies, the mandate, and Medicaid expansion: Coverage effects of the Affordable Care Act," Journal of Health Economics, Elsevier, vol. 53(C), pages 72-86.
    13. Alan I. Barreca & Melanie Guldi & Jason M. Lindo & Glen R. Waddell, 2011. "Saving Babies? Revisiting the effect of very low birth weight classification," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 126(4), pages 2117-2123.
    14. David Card & Carlos Dobkin & Nicole Maestas, 2009. "Does Medicare Save Lives?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 597-636.
    15. Sarah Miller & Cindy K. Soo, 2018. "Do Neighborhoods Affect Credit Market Decisions of Low-Income Borrowers? Evidence from the Moving to Opportunity Experiment," NBER Working Papers 25023, National Bureau of Economic Research, Inc.
    16. David Card & Carlos Dobkin & Nicole Maestas, 2008. "The Impact of Nearly Universal Insurance Coverage on Health Care Utilization: Evidence from Medicare," American Economic Review, American Economic Association, vol. 98(5), pages 2242-2258, December.
    17. Hu, Luojia & Kaestner, Robert & Mazumder, Bhashkar & Miller, Sarah & Wong, Ashley, 2018. "The effect of the affordable care act Medicaid expansions on financial wellbeing," Journal of Public Economics, Elsevier, vol. 163(C), pages 99-112.
    18. Kenneth Brevoort & Daniel Grodzicki & Martin B. Hackmann, 2017. "Medicaid and Financial Health," NBER Working Papers 24002, National Bureau of Economic Research, Inc.
    19. Robert B. Avery & Paul S. Calem & Glenn B. Canner, 2003. "An overview of consumer data and credit reporting," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), vol. 89(Feb), pages 47-73, February.
    20. Donghoon Lee & Wilbert Van der Klaauw, 2010. "An introduction to the FRBNY Consumer Credit Panel," Staff Reports 479, Federal Reserve Bank of New York.
    21. Breno Braga & Signe‐Mary Mckernan & Caroline Ratcliffe & Brett Theodos & John Chalekian & Christopher Trepel, 2019. "Local Conditions and Debt in Collections," Journal of Consumer Affairs, Wiley Blackwell, vol. 53(4), pages 2058-2085, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tal Gross & Timothy J. Layton & Daniel Prinz, 2022. "The Liquidity Sensitivity of Healthcare Consumption: Evidence from Social Security Payments," American Economic Review: Insights, American Economic Association, vol. 4(2), pages 175-190, June.
    2. Nicole Gorton & Maxim L. Pinkovskiy, 2021. "Credit Access and Mobility during the Flint Water Crisis," Staff Reports 960, Federal Reserve Bank of New York.
    3. Michael Batty & Christa Gibbs & Benedic Ippolito, 2022. "Health insurance, medical debt, and financial well‐being," Health Economics, John Wiley & Sons, Ltd., vol. 31(5), pages 689-728, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paul Goldsmith-Pinkham & Maxim L. Pinkovskiy & Jacob Wallace, 2020. "The Great Equalizer: Medicare and the Geography of Consumer Financial Strain," Staff Reports 911, Federal Reserve Bank of New York.
    2. Samuel Dodini, 2023. "Insurance Subsidies, the Affordable Care Act, and Financial Stability," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 42(1), pages 97-136, January.
    3. Charles Courtemanche & James Marton & Benjamin Ukert & Aaron Yelowitz & Daniela Zapata, 2018. "Early Effects of the Affordable Care Act on Health Care Access, Risky Health Behaviors, and Self‐Assessed Health," Southern Economic Journal, John Wiley & Sons, vol. 84(3), pages 660-691, January.
    4. Sarah Miller & Luojia Hu & Robert Kaestner & Bhashkar Mazumder & Ashley Wong, 2021. "The ACA Medicaid Expansion in Michigan and Financial Health," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 40(2), pages 348-375, March.
    5. Courtemanche, Charles & Friedson, Andrew & Koller, Andrew P. & Rees, Daniel I., 2019. "The affordable care act and ambulance response times," Journal of Health Economics, Elsevier, vol. 67(C).
    6. Argys, Laura M. & Friedson, Andrew I. & Pitts, M. Melinda & Tello-Trillo, D. Sebastian, 2020. "Losing public health insurance: TennCare reform and personal financial distress," Journal of Public Economics, Elsevier, vol. 187(C).
    7. Russ Kashian & Nicholas Lovett & Yuhan Xue, 2020. "Has the affordable care act affected health care efficiency?," Journal of Regulatory Economics, Springer, vol. 58(2), pages 193-233, December.
    8. Cortnie Shupe, 2023. "Public Health Insurance and Medical Spending: The Incidence of the ACA Medicaid Expansion," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 42(1), pages 137-165, January.
    9. Brevoort, Kenneth & Grodzicki, Daniel & Hackmann, Martin B., 2020. "The credit consequences of unpaid medical bills," Journal of Public Economics, Elsevier, vol. 187(C).
    10. Helen Levy & Thomas Buchmueller & Sayeh Nikpay, 2019. "The Impact of Medicaid Expansion on Household Consumption," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 45(1), pages 34-57, January.
    11. Amy Finkelstein & Sarah Taubman & Bill Wright & Mira Bernstein & Jonathan Gruber & Joseph P. Newhouse & Heidi Allen & Katherine Baicker, 2012. "The Oregon Health Insurance Experiment: Evidence from the First Year," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(3), pages 1057-1106.
    12. Rebecca M. Myerson & Reginald D. Tucker‐Seeley & Dana P. Goldman & Darius N. Lakdawalla, 2020. "Does Medicare Coverage Improve Cancer Detection and Mortality Outcomes?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(3), pages 577-604, June.
    13. Masanori Kuroki, 2021. "The effect of health insurance coverage on personal bankruptcy: evidence from the Medicaid expansion," Review of Economics of the Household, Springer, vol. 19(2), pages 429-451, June.
    14. Gallagher, Emily A. & Gopalan, Radhakrishnan & Grinstein-Weiss, Michal, 2019. "The effect of health insurance on home payment delinquency: Evidence from ACA Marketplace subsidies," Journal of Public Economics, Elsevier, vol. 172(C), pages 67-83.
    15. Carlos Dobkin & Amy Finkelstein & Raymond Kluender & Matthew J. Notowidigdo, 2018. "The Economic Consequences of Hospital Admissions," American Economic Review, American Economic Association, vol. 108(2), pages 308-352, February.
    16. Angrisani, Marco & Atella, Vincenzo & Brunetti, Marianna, 2018. "Public health insurance and household portfolio Choices: Unravelling financial “Side Effects” of Medicare," Journal of Banking & Finance, Elsevier, vol. 93(C), pages 198-212.
    17. Raj Chetty & Amy Finkelstein, 2012. "Social Insurance: Connecting Theory to Data," NBER Working Papers 18433, National Bureau of Economic Research, Inc.
    18. Courtemanche, Charles & Friedson, Andrew I. & Rees, Daniel I., 2018. "Ambulance Utilization in New York City after the Implementation of the Affordable Care Act," IZA Discussion Papers 11444, Institute of Labor Economics (IZA).
    19. Barbaresco, Silvia & Courtemanche, Charles J. & Qi, Yanling, 2015. "Impacts of the Affordable Care Act dependent coverage provision on health-related outcomes of young adults," Journal of Health Economics, Elsevier, vol. 40(C), pages 54-68.
    20. Kondo, Ayako & Shigeoka, Hitoshi, 2013. "Effects of universal health insurance on health care utilization, and supply-side responses: Evidence from Japan," Journal of Public Economics, Elsevier, vol. 99(C), pages 1-23.

    More about this item

    Keywords

    credit bureau data; public health insurance; geographic variation;
    All these keywords.

    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:hka:wpaper:2020-004. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Jennifer Pachon (email available below). General contact details of provider: https://edirc.repec.org/data/mfichus.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.