The Effects of Medicaid and Medicare Reforms on the Elderly’s Savings and Medical Expenditures

30 Pages Posted: 18 Nov 2010

See all articles by Mariacristina De Nardi

Mariacristina De Nardi

University College London, Economics Dpt.; Federal Reserve Bank of Chicago; National Bureau of Economic Research (NBER) - Public Economics

Eric French

Department of Economics; Institute for Fiscal Studies (IFS)

John Bailey Jones

Federal Reserve Bank of Richmond; SUNY at Albany - School of Business

Date Written: October 1, 2010

Abstract

We study a model in which retired single people optimally choose consumption, medical spending and saving while facing uncertainty about their health, lifespan and medical needs. This uncertainty is partially offset by insurance provided by the government and private institutions. We first show how well the model matches important features of the data and we analyze the degree of insurance provided by current programs. We then analyze the effects of some reforms, meant to capture changes in Medicaid and Medicare, on savings and medical expenditures.

Suggested Citation

De Nardi, Mariacristina and French, Eric and Jones, John B., The Effects of Medicaid and Medicare Reforms on the Elderly’s Savings and Medical Expenditures (October 1, 2010). Michigan Retirement Research Center Research Paper No. 2010-236, Available at SSRN: https://ssrn.com/abstract=1710723 or http://dx.doi.org/10.2139/ssrn.1710723

Mariacristina De Nardi (Contact Author)

University College London, Economics Dpt. ( email )

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Eric French

Department of Economics ( email )

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John B. Jones

Federal Reserve Bank of Richmond ( email )

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SUNY at Albany - School of Business ( email )

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