Health Insurance and Hospital Supply: Evidence from 1950s Coal Country

57 Pages Posted: 18 May 2020 Last revised: 9 Jul 2021

See all articles by Theodore F. Figinski

Theodore F. Figinski

Government of the United States of America - Department of the Treasury

Erin Troland

Board of Governors of the Federal Reserve System

Date Written: April, 2020

Abstract

The United States government spends billions on public health insurance and has funded a number of programs to build health care facilities. However, the government runs these two types of programs separately: in different places, at different times, and for different populations. We explore whether access to both health insurance and hospitals can improve health outcomes and access to health care. We analyze a coal mining union health insurance program in 1950s Appalachia with and without a complementary hospital construction program. Our results show that the union insurance alone increased hospital births and reduced infant mortality. Once the union hospitals opened, however, the insurance and the hospitals together substantially increased the net amount of hospital beds and health care employees, with limited crowd-out of existing private hospitals. Our results suggest that hospitals can complement health insurance in underserved areas.

JEL Classification: H51, I13, I18, N32, R58

Suggested Citation

Figinski, Ted and Troland, Erin, Health Insurance and Hospital Supply: Evidence from 1950s Coal Country (April, 2020). FEDS Working Paper No. 2020-33, Available at SSRN: https://ssrn.com/abstract=3881612 or http://dx.doi.org/10.17016/FEDS.2020.033

Ted Figinski (Contact Author)

Government of the United States of America - Department of the Treasury ( email )

1500 Pennsylvania Avenue, NW
Washington, DC 20220
United States

Erin Troland

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

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