Does Medicare Save Lives?

Abstract

The health insurance characteristics of the population changes sharply at age 65 as most people become eligible for Medicare. But do these changes matter for health? We address this question using data on over 400,000 hospital admissions for people who are admitted through the emergency room for "non-deferrable" conditions-diagnoses with the same daily admission rates on weekends and weekdays. Among this subset of patients there is no discernible rise in the number of admissions at age 65, suggesting that the severity of illness is similar for patients on either side of the Medicare threshold. The insurance characteristics of the two groups are much different, however, with a large jump at 65 in the fraction who have Medicare as their primary insurer, and a reduction in the fraction with no coverage. These changes are associated with significant increases in hospital list chargers, in the number of procedures performed in hospital, and in the rate that patients are transferred to other care units in the hospital. We estimate a nearly 1 percentage point drop in 7-day mortality for patients at age 65, implying that Medicare eligibility reduces the death rate of this severely ill patient group by 20 percent. The mortality gap persists for at least two years following the initial hospital admission.

Why do the Elderly Save? The Role of Medical Expenses

“…More in line with what one might expect, Card, Dobkin, and Maestas (2009) find that Medicare caused a small reduction in mortality among 65-year-olds admitted through emergency rooms for "nondeferrable" conditions. Khwaja (forthcoming) studies a structural model in which medical expenditures both improve health and provide utility.…”

Removing the User Fees for the Under-Fives' Simple Malaria Treatment in Cameroon: Effect on the Health Services Utilization

“…Considering that a policy process lead to a complex causal chain, it is crucial to measure outcomes that reflect its final objective. A key lesson for future research, and one that concurs with the conclusions offered by Card et al [37] is that identifying an impact of health care financing reforms on health outcome is challenging. Progress will call for innovative and rigorous research designs that are powered to seize any effects in multiple dimensions of health [38].…”

Life-Cycle Consumption Patterns at Older Ages in the US and the UK: Can Medical Expenditures Explain the Difference?

“…For example, those who have received Social Security disability benefits for at least 24 months automatically receive partial coverage. Around 12% of the population are already enrolled by the time they reach age 65 (Card et al (2009) There is a further institutional difference between the two countries. In the US, a large fraction of individuals have their private insurance costs covered by third parties (usually employers).…”