The Interaction between Consumption and Health in Retirement by John Karl Scholz, Ananth Seshadri :: SSRN

November 16, 2016

We study the interaction between consumption and health in retirement. Our main contribution is the estimation of a consumption Euler equation taking health into consideration. The Euler equation is derived from a model of consumption in retirement with three important building blocks of health: health shocks, health as an investment and health as a provider of utility. We estimate the Euler equation using data from the Health and Retirement Study (HRS) and Consumption and Activities Mail Survey (CAMS). The estimates suggest that health is an important determinant of utility. We use the estimated model to study the empirical significance of the three building blocks of health. We find that health shocks play an important role in slowing down the decline of consumption with age in retirement. We also find that including health into the utility function could help explain the heterogeneous consumption-age profiles related to health. Finally, we find that health investments, such as physical exercise, have a significant effect on the evolutions of both health and consumption in retirement.

Source: The Interaction between Consumption and Health in Retirement by John Karl Scholz, Ananth Seshadri :: SSRN


Best Marijuana Taxes Yet: California’s Proposition 64 by Pat Oglesby :: SSRN

October 29, 2016

Two devastating traps threaten taxes on newly legalized marijuana. One is the quicksand of inflexibility, leading to impotence during a whirlwind of market change. Static laws and price-based taxes lead into that trap.The trap other is playing favorites by favoring medical users, opening an abyss of tax evasion by recreational users pretending to be sick. California’s Proposition 64, on the ballot in November, avoids those traps better than the marijuana initiatives in Arizona, Massachusetts, Maine, and Nevada.It takes lessons from failed initiatives in California, Ohio, and Oregon, and laws on the books in Alaska, Colorado, Oregon, and Washington.

Source: Best Marijuana Taxes Yet: California’s Proposition 64 by Pat Oglesby :: SSRN


The Once and Future Cadillac Tax | Bill of Health

October 16, 2015

The National War Labor Board was still cautious of this benefit becoming unreasonable and put a limit on the amount of health insurance that could be tax-free in their 1943 decision. The Board ruled that tax-free health insurance expenditures must be less than five percent of annual salary.

This limit on the amount of money that an employer can spend on health insurance was not present in the 1954 law that cemented the tax treatment of health insurance. As noted earlier, the share of health insurance as a percent of income was much less than five percent. The policy makers of the time did not have a reason to believe that medical costs would rise to what they are today. Except they should have. The federal investment in medical technology has been had been growing at 10 times the rate of wage growth for the previous two decades.

Source: The Once and Future Cadillac Tax | Bill of Health


Is It Fair to Ask the Internet to Pay Your Hospital Bill? — The Atlantic

March 13, 2015

Before the donors can choose who to fund, the sites themselves make a choice about who will be allowed to ask for funding at all. In September 2014, GoFundMe made headlines after it shut down the fundraising page of a woman named Bailey, who was collecting money for an abortion. She had no insurance, Bailey wrote on her page, and complications from a “rough, unplanned, and unexpected” pregnancy had left her unable to keep a job.

“We do not permit campaigns that could be considered divisive. Abortion would be a good example.”

After removing Bailey’s fundraiser (she was allowed to keep the money that had been donated up until that point), the site issued a list of causes that would be prohibited going forward, including “directly funding an abortion (human or animal).”

“As we scale, it’s important that GoFundMe is used in ways that our community and company can be proud of,” the company said in a statement. (Lee, of YouCaring, said his site has a similar policy: “We do not permit crowdfunding campaigns that could be considered divisive to our community,” he said. “Abortion would be a good example.”)

via Is It Fair to Ask the Internet to Pay Your Hospital Bill? — The Atlantic.


How Much of Your Taxes go to Health Care? Do the Math. – The Experts – WSJ

February 20, 2015

Between state, federal and Medicare taxes, and insurance premium growth potentially displacing wage increases, you paid a high price for health care in 2014—even if you were healthy and never used the system once.

via How Much of Your Taxes go to Health Care? Do the Math. – The Experts – WSJ.


Employer-Based Health Insurance ‘Cheaper’ Than Government-Sponsored Insurance? Say What?

August 5, 2014

Every so often in punditry land there appears a column so egregiously flawed that it makes a perfect platform for a homework assignment in undergraduate health-economics courses. With a straight face and little commentary, one mandates students to fact-check the piece and to examine its inherent logic. Students relish taking apart in this way the scribblings of seasoned adults.

So we must thank Sally Pipes for contributing to pedagogy a veritable jewel along these lines in her July 28 Forbes article, entitled “Employer Health Insurance: A Bargain Compared to Government-Sponsored Coverage.”

via Employer-Based Health Insurance ‘Cheaper’ Than Government-Sponsored Insurance? Say What?.


Who Pays for Public Employee Health Costs? | Cato Institute

July 23, 2014

We find that in recent years, when fiscal conditions have been tight, health insurance premiums for state workers have grown materially less rapidly than premiums for comparable private- sector employers; this slower premium growth for state workers reflects, for example, changes from traditional comprehensive plans to networked plans, increases in deductibles, and/or non-transparent reductions in access due to reductions in payments to providers. Interestingly, the share of the premium paid by state workers has tended to rise in states with high rates of public-sector unionization, where the employee share started at a low base, while the share has fallen elsewhere.

via Who Pays for Public Employee Health Costs? | Cato Institute.