Essays on health care services and insurance coverage for older persons

Date of Completion

January 2002


Gerontology|Economics, General|Health Sciences, Public Health




Three essays examine the history of nursing homes and home health care, the demand for health services by older persons, and firms' decisions regarding retiree health insurance. The first essay is a qualitative discussion of how public policy, which has developed in reaction to social, medical, and economic environments, influences the ownership and integration patterns in the home care and nursing home industries during the twentieth century. The analysis focuses on how the organizational structure of these long-term care providers evolved as a consequence of policymakers' attempts to ensure quality care and contain costs. In the second essay, data from the Medical Expenditure Panel Survey—(Household Component and Nursing Home Component on individuals ages 65 and older)—are used to analyze living arrangements, the demand for paid health services in private settings, and the choice of nursing home type using a common set of explanatory variables. The behavioral models include measures of individuals' predisposing, need, and enabling characteristics to explain the utilization of health services. The results show that Medicaid coverage increases the likelihood of nursing home use, while Medicare coverage reduces it. Deductibles and other costs paid by individuals appear to reduce demand for physician visits but not paid home health or hospital visits. Horizontal integration of nursing homes allows a greater differentiation of service provision across the related facilities. Finally, the third essay examines manufacturing firms' decisions regarding whether or not to offer health insurance to retirees and the amount to contribute towards the premium cost for retiree health insurance. Using data from four different sources, including the Medical Expenditure Panel Survey—Insurance Component and the Census of Manufactures, this analysis uniquely controls for economic factors and market conditions as well as firm and workforce characteristics. The findings indicate that firms with better financial performance offer more generous benefits to their retirees. In addition, the results show that firms' decisions are also significantly influenced by the premium cost and availability of Medigap insurers and Medicare managed care plans. ^