Outpatient visits after retirement in Europe and the US

Abstract

I conduct an empirical analysis of the relation between retirement and outpatient care use in Europe and the US, and investigate the potential driving factors of that. I link the empirical analysis to a theoretical model of medical care demand. I document that pensioners tend to visit a doctor with higher probability and more often than the rest of the 50+ population. Ceteris paribus, being retired implies 3–10 % more outpatient visits in Europe. The estimates are of similar magnitude in the US. The paper contributes to the understanding of how population ageing plays a part in the rising health care expenditures. I find evidence that retirement related individual characteristics, increasing leisure time and stronger health preferences all contribute to the positive relation between retirement and outpatient care use, which is mainly driven by the healthier individuals. The gatekeeper role of general practitioners can mitigate the increased demand for outpatient care services after retirement.

How does retirement affect healthcare expenditures? Evidence from a change in the retirement age

“…Among women, the effects of retirement are driven by the healthier, by those who spent some time on sick leave, and by the less educated. These heterogeneity results are mostly in line with the previous theoretical literature on the relationship between retirement and healthcare use (e.g., Kuhn, Wrzaczek, Prskawetz, & Feichtinger, or Bíró, ), but we explore an additional, previously not investigated mechanism, the role of sick leave.…”

“…Finally, to give supplementary evidence and to exploit the available data for men and for women in the period of their unchanged early retirement age, we also estimate models for both genders, in which we use the constant early retirement age as instrumental variable for retirement. This is the usual way in the literature to overcome endogeneity (see Neuman, ; Coe & Zamarro, ; Bonsang, Adam, & Perelman, ; Eibich, ; Bíró, ). Compared to the baseline IV model, this specification may exploit a wider age range before and after retirement.…”

“…Theoretically, retirement may influence healthcare use through various channels. To analyse this, Bíró () presents a simple static model with Cobb–Douglas utility of consumption and health, where health is allowed to depend on retirement status and is a linear function of healthcare use, and the budget constraints are different while working versus while being retired. On the one hand, retirement may decrease the optimal level of healthcare in this model because financial incentives to remain healthy and thus to receive higher wages disappear after retirement.…”

“…Earlier empirical studies find little evidence for a significant effect of retirement on healthcare use (Boaz & Muller, ; Shapiro & Roos, ; Soghikian, Midanik, Polen, & Ransom, ). In contrast, Bíró () finds that conditional on health, being retired implies 3–9% more outpatient visits in Europe, and the results are similar for the United States. However, if retirement has a positive effect on health, then the total effect of retirement on healthcare use (without conditioning on health) may even be negative.…”

Introduction to the Thematic Section on Health Economics

“…Finally, the job strain approach appears flawed since the balance between 'demand' and 'control' should not have deleterious consequences on health. Other studies suggest that, with identical healthcare needs, self-employed workers demand less healthcare during their working life (Pfeifer, 2013) and more than employees after they retire (Boaz & Muller, 1989;Bíró, 2016). This article develops an alternative framework to better describe and understand the specificity of changes in self-employed workers' healthcare behaviour over the life course.…”