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DO SUPPLY‐SIDE FORCES EXPLAIN GEOGRAPHIC VARIATION IN HEALTH CARE USE?
Author(s) -
Callison Kevin,
Kaestner Robert,
Ward Jason
Publication year - 2021
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/ecin.12926
Subject(s) - supply side , variation (astronomy) , demand side , regional variation , geographic variation , health care , economics , demographic economics , medicine , business , economic growth , microeconomics , population , environmental health , physics , advertising , astrophysics
Regional variation in health care utilization has been well‐documented, yet uncertainty persists about whether this variation is primarily the result of supply‐side or demand‐side forces. We provide new evidence on this issue by examining changes in health care use for the near‐elderly as they transition from being uninsured into Medicare. Results support a causal, supply‐side explanation of regional variation. Estimates indicate that gaining Medicare coverage in above‐median spending regions increases the probability of at least one hospital visit by 40% and the probability of having more than five doctor visits by 26% relative to similar individuals in below‐median spending regions. ( JEL D43, H42, H51, I1, I11, I13)