Is More Better? Elective Surgery, Paid and Unpaid Work amongst Older Adults

Lauren H. Nicholas, University of Michigan

Regional variation in rates of elective surgery amongst patients with similar mortality patterns raise concerns about overutilization. I use Health and Retirement Study data to consider the effect of elective surgery on non-health outcomes; paid and unpaid work. I find that patients receiving elective joint replacements in geographic regions with high rates of procedure use, where the marginal procedures are often viewed as discretionary or unnecessary, increase both paid and unpaid work after surgery. The response to surgery occurs on the extensive margin, with patients more likely to be working, volunteering and providing informal care post-surgery. Patients receiving surgery in high-intensity regions increase labor force participation by 2.5 percentage points and informal caregiving by 6.1 percentage points. Findings suggest that attempts to reduce Medicare spending by reducing elective procedure use may have adverse implications for Social Security financing and further constrain availability of informal caregiving for the growing elderly population.