Aging

Consumer credit has shown increasing relevance to the health of older adults; however, studies have not been able to assess the extent to which creditworthiness influences future health or health influences future creditworthiness. We assessed the relationships between 4-year pre and postmorbid consumer credit history and self-rated physical and mental health outcomes among older adults. Generalized estimating equations models assessed pre and postmorbid credit history (credit scores, derogatory accounts, and unpaid accounts in collections) and the onset of poor self-rated health (SF-36 score <50) among 1,740 participants aged 65+ in the Advanced Cognitive Training for Independent and Vital Elderly study from 2001 to 2017, linked to TransUnion consumer credit data. In any given year, up to 1/4 of participants had a major derogatory, unpaid, or collections account, and up to 13% of the sample had poor health. Each 50-point increase in credit score trended toward a 5% lower odds of poor health in the next 1 year, a 6% lower odds in the next 2 years, and a statistically significant finding of 13% lower odds by 3 years. A drop in credit score was associated with a 10% greater odds of poor health in the next year, and having a major derogatory account was associated with an 86% greater odds of poor health in the next 3 years. After poor health onset, credit scores continued to see significant losses up to the 3 years, with larger decrements over time. Having a major derogatory account or a sudden loss in credit may be a time to monitor older adults for changes in health. After a downturn in health, supporting older adults to manage their debt may help stabilize their credit.

Alternative payment models, such as bundled payment, have been proposed as a solution to the high costs of health care. While these models are typically effective at constraining spending on post-acute care, the decrease in consumption of formal post-acute care may result in a compensatory increase in the need for and use of informal or family caregiving. We estimate the effect of a large, randomized experiment with Medicare bundled payment on the need for and receipt of caregiving. Using data on over 2 million Medicare beneficiaries undergoing knee or hip replacement and a difference-in-differences approach, we find that the mandatory bundled payment caused a 1 to 2 percentage point absolute increase (a 9 percent to 14–15 percent relative increase) in both the need for and receipt of help with activities of daily living at the end of a home health episode, help that was likely provided by family caregivers. This increased caregiver burden was corroborated by a large shift away from nursing-home-based post-acute care (or care in a skilled nursing facility or SNF) after knee or hip replacement, a shift toward home health care, and an accompanying decline in the intensity of home care.