Document Type

Article

Publication Date

Fall 11-2012

Abstract

During the US recession of 2007-09, overall health care spending growth fell, but Medicare spending growth increased. Using state-level data from the period 1991-2009, we show that these divergent trends were also observed within states. Furthermore, increases in state unemployment rates were associated with higher Medicare spending per capita and increased hospital use by Medicare beneficiaries. For example, a one-percentage-point point rise in the unemployment rate was associated with a $40 (0.7 percent) increase in Medicare spending per capita. Our results suggest that economic downturns contribute to Medicare spending and use. One of many possible explanations may be that health care providers have greater capacity, inclination, and financial incentive to treat Medicare patients during recessions as a result of slackening demand from the non-Medicare population.

Journal Title

Health Affairs

DOI

10.1377/hlthaff.2012.0005

Volume

31

Issue

11

Journal Article URL

https://www.healthaffairs.org/doi/pdf/10.1377/hlthaff.2012.0005

First Page

2464

Included in

Economics Commons

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