Working Paper: NBER ID: w17440
Authors: Gopi Shah Goda; John B. Shoven; Sita Nataraj Slavov
Abstract: Despite the presence of Medicare, out-of-pocket medical spending is a large expenditure risk facing the elderly. While women live longer than men, elderly women incur higher out-of-pocket medical spending than men at each age. In this paper, we examine whether differences in marital status and living arrangements can explain this difference. We find that out-of-pocket medical spending is approximately 29 percent higher when an individual becomes widowed, a large portion of which is spending on nursing homes. Our results suggest a substantial role of living arrangements in out-of-pocket medical spending; however, our estimates combined with differences in rates of widowhood across gender suggest that marital status can explain only one third of the gender difference in total out-of-pocket medical spending, leaving a large portion unexplained. On the other hand, gender differences in widowhood more than explain the observed gender difference in out-of-pocket spending on nursing homes.
Keywords: widowhood; gender differences; out-of-pocket medical spending; elderly; long-term care
JEL Codes: I11; I12; I14; I16
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Widowhood (J12) | out-of-pocket medical spending (H51) |
| Widowhood (J12) | nursing home expenditures (H51) |
| Widowhood (J12) | average number of nursing home nights (I11) |
| out-of-pocket medical spending (H51) | gender difference in total out-of-pocket medical spending (H51) |
| Widowhood (J12) | nursing home demand (J20) |