Description
- Abstract:
- Over 150 million Americans receive health insurance benefits from an employer as a form of compensation. In recent years, health care costs have grown rapidly, raising concerns that increased health care spending crowds out wage increases. We leverage hospital mergers to test the impact of health care prices on wages and benefit design. We find that within-market hospital mergers over the 2012-2022 period led to a $985 increase in health care spending per worker plan and a $991 reduction in wages among workers with employer-sponsored health insurance, implying near complete pass-through from health care spending to wages. We also find evidence that hospital mergers increase per enrollee deductible and cost-sharing payments, though out-of-pocket spending as a percentage of total health care spending does not change. Our results imply that Americans feel the effects of rising health care costs via two channels: higher out-of-pocket spending and lower wages.
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Citation
Daniel R. Arnold, and Christopher M. Whaley,
"Who Pays for Health Care Costs? The Effects of Health Care Prices on Wages"
(2025).
Center for Advancing Health Policy through Research (CAHPR) Digital Collection.
Brown Digital Repository. Brown University Library.
https://doi.org/10.2139/ssrn.4959256
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Center for Advancing Health Policy through Research (CAHPR) Digital Collection
This collection contains research outputs produced by members of the Center for Advancing Health Policy through Research (CAHPR). Collection DOI: https://doi.org/10.26300/mshb-sp27...