TY - JOUR
T1 - The economic downturn and its lingering effects reduced medicare spending growth by $4 billion in 2009-12
AU - Dranove, David
AU - Garthwaite, Craig
AU - Ody, Christopher
N1 - Publisher Copyright:
© 2015 Project HOPE-The People-to-People Health Foundation, Inc.
Copyright:
Copyright 2017 Elsevier B.V., All rights reserved.
PY - 2015
Y1 - 2015
N2 - Previous work has found a strong connection between the most recent economic recession and reductions in private health spending. However, the effect of economic downturns on Medicare spending is less clear. In contrast to studies involving earlier time periods, our study found that when the macroeconomy slowed during the Great Recession of 2007-09, so did Medicare spending growth. A small (14 percent) but significant share of the decline in Medicare spending growth from 2009 to 2012 relative to growth from 2004 to 2009 can be attributed to lingering effects of the recession. Absent the economic downturn, Medicare spending would have been $4 billion higher in 2009-12. A major reason for the relatively small impact of the macroeconomy is the relative lack of labor-force participation among people ages sixty-five and older.We estimate that if they had been working at the same rate as the nonelderly before the recession, the effect of the downturn on Medicare spending growth would have been twice as large.
AB - Previous work has found a strong connection between the most recent economic recession and reductions in private health spending. However, the effect of economic downturns on Medicare spending is less clear. In contrast to studies involving earlier time periods, our study found that when the macroeconomy slowed during the Great Recession of 2007-09, so did Medicare spending growth. A small (14 percent) but significant share of the decline in Medicare spending growth from 2009 to 2012 relative to growth from 2004 to 2009 can be attributed to lingering effects of the recession. Absent the economic downturn, Medicare spending would have been $4 billion higher in 2009-12. A major reason for the relatively small impact of the macroeconomy is the relative lack of labor-force participation among people ages sixty-five and older.We estimate that if they had been working at the same rate as the nonelderly before the recession, the effect of the downturn on Medicare spending growth would have been twice as large.
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U2 - 10.1377/hlthaff.2015.0100
DO - 10.1377/hlthaff.2015.0100
M3 - Article
C2 - 26240251
AN - SCOPUS:84938702733
VL - 34
SP - 1368
EP - 1375
JO - Health affairs (Project Hope)
JF - Health affairs (Project Hope)
SN - 0278-2715
IS - 8
ER -