Working Paper: NBER ID: w17689
Authors: Mariacristina De Nardi; Eric French; John Bailey Jones; Angshuman Gooptu
Abstract: We describe the Medicaid eligibility rules for the elderly. Medicaid is administered jointly by the Federal and state governments, and each state has significant flexibility on the details of the implementation. We document the features common to all states, but we also highlight the most salient state-level differences. \n \nThere are two main pathways to Medicaid eligibility for people over age 65: either having low assets and income, or being impoverished due to large medical expenses. The first group of recipients (the categorically needy) mostly includes life-long poor individuals, while the second group (the medically needy) includes people who might have earned substantial amounts of money during their lifetime but have become impoverished by large medical expenses. The categorically needy program thus only affects the savings decision of people who have been poor throughout most of their lives. In contrast, the medically needy program provides some insurance even to people who have higher income and assets. Thus, this second pathway is to some extent going to affect the savings of the relatively higher income and assets people.
Keywords: Medicaid; Elderly; Healthcare; Savings Behavior
JEL Codes: H1; H31; I13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Medicaid eligibility rules (I18) | savings behavior of elderly individuals (D14) |
| Categorically needy program (H53) | savings decisions of individuals who have been poor throughout their lives (D14) |
| Medically needy program (I18) | savings behavior of individuals who become impoverished due to medical expenses (D14) |
| Medicaid's asset and income testing mechanisms (I18) | disincentives for saving (E21) |