Effects of Prescription Drug Insurance on Hospitalization and Mortality: Evidence from Medicare Part D

34 Pages Posted: 28 May 2020

See all articles by Robert Kaestner

Robert Kaestner

University of Chicago; National Bureau of Economic Research (NBER)

Cuiping Schiman

Pennsylvania State University Harrisburg

G. Alexander

Johns Hopkins University - Department of Environmental Health Sciences and Epidemiology; Johns Hopkins University - Department of Medicine; Monument Analytics

Multiple version iconThere are 2 versions of this paper

Date Written: September 2019

Abstract

We used Medicare administrative data (2002–2009) and an instrumental variables design that exploits the natural experiment created by the implementation of Medicare Part D to estimate the effect of prescription drug coverage insurance on the use and costs of inpatient services. We find that gaining prescription drug insurance through Part D caused approximately a 4 percent decrease in hospital admission rate, a 2–5 percent decrease in Medicare inpatient payments per person, and a 10–15 percent decrease in inpatient charges. Among specific types of admissions, gaining insurance was associated with significant decreases in admissions for CHF and COPD.

Suggested Citation

Kaestner, Robert and Schiman, Cuiping and Alexander, G. Caleb, Effects of Prescription Drug Insurance on Hospitalization and Mortality: Evidence from Medicare Part D (September 2019). Journal of Risk and Insurance, Vol. 86, Issue 3, pp. 595-628, 2019, Available at SSRN: https://ssrn.com/abstract=3610281 or http://dx.doi.org/10.1111/jori.12229

Robert Kaestner (Contact Author)

University of Chicago ( email )

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National Bureau of Economic Research (NBER)

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Cuiping Schiman

Pennsylvania State University Harrisburg ( email )

G. Caleb Alexander

Johns Hopkins University - Department of Environmental Health Sciences and Epidemiology ( email )

Baltimore, MD 21205
United States

Johns Hopkins University - Department of Medicine ( email )

720 Rutland Avenue
Baltimore, MD 21205-2196
United States

Monument Analytics ( email )

Baltimore, MD
United States

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