Health Economics Seminars (EUR)

Speaker(s)
Helena Hernández Pizarro (Universitat Pompeu Fabra, Spain)
Date
Tuesday, June 23, 2015
Location
Rotterdam

This paper studies the effects of a new Long Term Care (LTC) policy, set by the Spanish Government in 2006, on the mortality of the beneficiaries. Under this policy, dependants, individuals who have lost the autonomy to perform daily basic activities, receive benefits to partially offset the burden of their dependency. First, applicants are physically and intellectually assessed by the examiners, who summarize their level of need with a score. These scores are map into 7 different categories of LTC needs, which define the menu of benefits the individuals can opt in. To estimate the causal impact of LTC benefits on dependants’ mortality we exploit the random assignment of the examiners to LTC applicants. Given the different level of examiners’ leniency, applicants assigned to more lenient examiners have higher probabilities to obtain higher score, which entitles them to larger benefits. We use Catalan administrative data and focus on the applicants whose score lie around the threshold between two degrees of benefit. Our findings show that individuals scored just above each threshold has reduced the probability of death within the first (five) year(s) after receiving the benefit by 2.5% (9.5%). We provide evidence of the mechanism underlying this effect.