Take Action

Home | Faculty & Research Overview | Research

Research Details

The Economic Downturn And Its Lingering Effects Reduced Medicare Spending Growth By $4 Billion In 2009-12, Health Affairs


Previous work has found a strong connection between the most recent economic recession and reductions in private health spending. However, the effect of economic downturns on Medicare spending is less clear. In contrast to studies involving earlier time periods, our study found that when the macroeconomy slowed during the Great Recession of 2007–09, so did Medicare spending growth. A small (14 percent) but significant share of the decline in Medicare spending growth from 2009 to 2012 relative to growth from 2004 to 2009 can be attributed to lingering effects of the recession. Absent the economic downturn, Medicare spending would have been $4 billion higher in 2009–12. A major reason for the relatively small impact of the macroeconomy is the relative lack of labor-force participation among people ages sixty-five and older. We estimate that if they had been working at the same rate as the nonelderly before the recession, the effect of the downturn on Medicare spending growth would have been twice as large.




David Dranove, Craig Garthwaite, Christopher Ody

Date Published



Dranove, David, Craig Garthwaite, and Christopher Ody. 2015. The Economic Downturn And Its Lingering Effects Reduced Medicare Spending Growth By $4 Billion In 2009-12. Health Affairs.(8): 1368-1375.


Explore leading research and ideas

Find articles, podcast episodes, and videos that spark ideas in lifelong learners, and inspire those looking to advance in their careers.
learn more


Review Courses & Schedules

Access information about specific courses and their schedules by viewing the interactive course scheduler tool.


Discover the path to your goals

Whether you choose our Full-Time, Part-Time or Executive MBA program, you’ll enjoy the same unparalleled education, exceptional faculty and distinctive culture.
learn more