The Distributional Effects of Medicare
The Medicare program is now an important source of transfers to elderly and disabled beneficiaries, and will continue to grow rapidly in the future. Because the Medicare program is so large in magnitude, it can have significant redistributional effects. In this paper, we measure the flow of Medicare benefits to high-income and low-income neighborhoods in 1990 and 1995. We find that Medicare spending per capita for the lowest income groups grew much more rapidly than Medicare spending in either high income or middle income neighborhoods. Home health care spending played an important role in the increased spending among the lowest income neighborhoods. To our knowledge, this differential shift in spending has not been documented, yet it exceeds in magnitude the entire per capita transfer from the Earned Income Tax Credit (EITC) and is half of the average transfers to the elderly poor from Supplemental Security Income (SSI). Recent cutbacks in home health care benefits may undo some of this change. Still, this example illustrates how specific technical changes in Medicare policy can have redistributional effects comparable to major and much more visible expenditure and tax policies.
|Date of creation:||Jan 1999|
|Publication status:||published as The Distributional Effects of Medicare , Julie Lee, Mark McClellan, Jonathan Skinner. in Tax Policy and the Economy, Volume 13 , Poterba. 1999|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mark McClellan & Jonathan Skinner, 1997.
"The Incidence of Medicare,"
NBER Working Papers
6013, National Bureau of Economic Research, Inc.
- Alan J. Auerbach & Jagadeesh Gokhale & Laurence J. Kotlikoff, 1992.
"Social Security and Medicare Policy from the Perspective of Generational Accounting,"
in: Tax Policy and the Economy, Volume 6, pages 129-145
National Bureau of Economic Research, Inc.
- Alan J. Auerbach & Jagadeesh Gokhale & Laurence J. Kotlikoff, 1991. "Social Security and Medicare Policy From the Perspective of Generational Accounting," NBER Working Papers 3915, National Bureau of Economic Research, Inc.
- Alan J. Auerbach & Jagadeesh Gokhale & Laurence J. Kotlikoff, 1992. "Social security and Medicare policy from the perspective of generational accounting," Working Paper 9206, Federal Reserve Bank of Cleveland.
- Panis, C.W.A. & Lillard, L.A., 1996. "Socioeconomic Differentials in the Returns to Social Security," Papers 96-05, RAND - Labor and Population Program.
- Mark G. Duggan, 2000.
"Hospital Ownership and Public Medical Spending,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 115(4), pages 1343-1373.
- Manning, Willard G, et al, 1987. "Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment," American Economic Review, American Economic Association, vol. 77(3), pages 251-277, June.
- Victor R. Fuchs, 1998. "Provide, Provide: The Economics of Aging," NBER Working Papers 6642, National Bureau of Economic Research, Inc.
- Charles R. Link & Stephen H. Long & Russell F. Settle, 1982. "Equity and the Utilization of Health Care Services by the Medicare Elderly," Journal of Human Resources, University of Wisconsin Press, vol. 17(2), pages 195-212.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:6910. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.