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Cited by 555Healthcare Policy and ManagementFinancial Literacy, Pension, Retirement AnalysisEconomic and Financial Impacts of Cancer

The Economic Consequences of Hospital Admissions

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Dobkin, Carlos, Finkelstein, Amy, Kluender, Raymond, Notowidigdo, Matthew J.·2018·American Economic Review
DOI 10.1257/aer.20161038PMC PMC5809140
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Abstract

We use an event study approach to examine the economic consequences of hospital admissions for adults in two datasets: survey data from the Health and Retirement Study, and hospitalization data linked to credit reports. For non-elderly adults with health insurance, hospital admissions increase out-of-pocket medical spending, unpaid medical bills, and bankruptcy, and reduce earnings, income, access to credit, and consumer borrowing. The earnings decline is substantial compared to the out-of-pocket spending increase, and is minimally insured prior to age-eligibility for Social Security Retirement Income. Relative to the insured non-elderly, the uninsured non-elderly experience much larger increases in unpaid medical bills and bankruptcy rates following a hospital admission. Hospital admissions trigger fewer than 5 percent of all bankruptcies in our sample. (JEL D14, G22, I11, I13)

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  • Empirical researchers commonly adjust for the extrapolation of a linear trend from the pre-treatment periods when there are concerns about violations of the parallel trends assumption, which is valid if the difference in trends is exactly linear.

    “Empirical researchers commonly adjust for the extrapolation of a linear trend from the pre-treatment periods when there are concerns about violations of the parallel trends assumption, which is valid if the difference in trends is exactly linear (e.g.Bhuller et al., 2013;Dobkin et al., 2018;Goodman-Bacon, 2018, 2021).”

    From A More Credible Approach to Parallel Trends (2023) · cites this paper as Dobkin et al., 2018

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  • In settings where researchers are worried about confounding from secular trends that they suspect evolve smoothly over time, it is common for empirical researchers to control for a linear group-specific time trend.

    “In such settings, it is common for empirical researchers to control for a linear group-specific time trend.”

    From A More Credible Approach to Parallel Trends (2023) · cites this paper as Dobkin et al., 2018

    Section 2.2 says the authors include a linear trend in event time because their non-parametric results suggest it captures secular trends in outcomes. It supports an example of this approach, but does not say that linear group-specific time trends are common among empirical researchers. (LLM, conf=0.82)

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Research works printed but not linked: 7

  1. [1]Agarwal Sumit Chomsisengphet Souphala Mahoney Neale Stroebel Johannes Do Banks Pass Through Credit Expansions to Consumers Who Want to Borrow? Quarterly Journal of Economics forthcoming
  2. [6]Avery Robert B Calem Paul S Canner Glenn B An Overview of Consumer Data and Credit Reporting Federal Reserve Bulletin 2 2003 47 73
  3. [35]Garthwaite Craig Gross Tal Notowidigdo Matthew J Hospitals as Insurers of Last Resort American Economic Journal: Applied Economics forthcoming
  4. [48]Ljungqvist Lars Sargent Thomas 2004 Recursive Macroeconomic Theory Cambridge, MA MIT Press 2
  5. [53]Mian Atif Rao Kamalesh Sufi Amir Household Balance Sheets, Consumption, and the Economic Slump The Quarterly Journal of Economics 128 4 2013 1687 1726
  6. [57]Pauly Mark V The economics of moral hazard: comment The American Economic Review 58 3 1968 531 537
  7. [62]Stavins Joanna Credit card borrowing, delinquency, and personal bankruptcy New England Economic Review 2000 15 30

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Authors
Dobkin, C., Finkelstein, A., Kluender, R., & Notowidigdo, M. J.
Affiliations
  • University of California, Santa Cruz (US)
  • Northwestern University (US)
ORCID
Venue
American Economic Review
Publisher
American Economic Association
Published
2018-02-01
Volume
108
Issue
2
Pages
308-352
ISSN
0002-8282 (ISSN-L)
DOI
10.1257/aer.20161038
PMC
PMC5809140
OpenAlex
W2412862172
Cited by
555
References
45
Citations by year
2026: 59 · 2025: 101 · 2024: 102 · 2023: 76 · 2022: 73 · 2021: 48 · 2020: 36 · 2019: 37 · 2018: 18 · 2017: 3 · 2015: 1
FWCI
52.67
Type
journal article
Language
en
Open access
Locations
  • American Economic Review (publishedVersion)
  • PubMed (publishedVersion)
  • Europe PMC (PubMed Central) (acceptedVersion)
  • PubMed Central (acceptedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
Funders
  • National Science Foundation (1122374)
  • National Institute on Aging (R01AG032449, P01AG005842, R37AG032449)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Healthcare Policy and Management
  • Social Sciences › Business, Management and Accounting › Accounting › Financial Literacy, Pension, Retirement Analysis
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic and Financial Impacts of Cancer
Keywords
hospitalization, unpaid medical bills, bankruptcy, earnings, income, access to credit, consumer borrowing, health insurance, uninsured adults, non-elderly adults

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