What are the potential productivity impacts of new medications that treat Medicare beneficiaries?
![What are the potential productivity impacts of new medications that treat Medicare beneficiaries?](https://www.insurancenewsmag.com/wp-content/uploads/2024/08/What-are-the-potential-productivity-impacts-of-new-medications-that.png)
One key aspect of many medications is that they not only help people feel better, but often these medications can help them re-enter the workforce, work more hours, work more productively, or all of the above. However, when evaluating new treatments for diseases that impact older Medicare beneficiaries (≥65 years), should we take into account productivity impacts?
The first question to ask is, what share of individuals aged ≥65 years are actually in the labor force. Data form the Bureau of Labor Statistics (BLS) finds that 26.6% of individuals age 65-74 and 8.2% of individuals
≥75 years are in the labor force. Data from the Medicare Current Beneficiary Survey (MCBS) finds that “7.5 percent of beneficiaries were enrolled in Part A only, which includes people 65 and over who are still employed and may be covered by employer sponsored insurance (ESI).”
https://www.bls.gov/emp/tables/civilian-labor-force-participation-rate.htm
Medicare beneficiaries also earn significant income. The median income for Medicare beneficiaries is $36,000 overall and $37,800 or Medicare beneficiaries aged ≥65 years. These figures, however, include income from all sources (e.g., investments, Social Security) in addition to wage income.
https://www.kff.org/medicare/issue-brief/income-and-assets-of-medicare-beneficiaries-in-2023/
Many studies do not consider the impact of new medicines on non-market labor such as volunteering. However, a study by Grinshteyn and Sugar (2021) uses 2008-2018 Health and Retirement Study (HRS) data found that among older Americans 33.2% had volunteered in the past year.
In short, while the productivity impacts for older individuals are likely less then for working age individuals, they should not be ignored entirely.