Income and the Utilization of Long-Term Care Services: Evidence from the Social Security Benefit Notch

Gopi Goda, Ezra Golberstein and David C. Grabowski

No 16076, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper estimates the impact of income on the long-term care utilization of elderly Americans using a natural experiment that led otherwise similar retirees to receive significantly different Social Security payments based on their year of birth. Using data from the 1993 and 1995 waves of the AHEAD, we estimate instrumental variables models and find that a positive permanent income shock lowers nursing home use but increases the utilization of paid home care services. We find some suggestive evidence that the effects are due to substitution of home care for nursing home utilization. The magnitude of these estimates suggests that moderate reductions in post-retirement income would significantly alter long-term utilization patterns among elderly individuals.

JEL-codes: H55 I1 J14 (search for similar items in EconPapers)
Date: 2010-06
Note: AG EH PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published as Goda, Gopi Shah & Golberstein, Ezra & Grabowski, David C., 2011. "Income and the utilization of long-term care services: Evidence from the Social Security benefit notch," Journal of Health Economics, Elsevier, vol. 30(4), pages 719-729, July.

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Journal Article: Income and the utilization of long-term care services: Evidence from the Social Security benefit notch (2011)
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