Healthcare Utilization during the Great Recession: Findings from a Panel of U.S. Workers

Background: Researchers disagree on how economic crises affect population health.  Several studies in high- and middle-income countries find a pro-cyclical relationship between unemployment rates and mortality.  There has been a decrease in the U.S. national expenditure on health during the Great Recession of 2007-2009, suggesting a possible decline in the need for services.  Yet it is possible that the lower expenditures are due to patients foregoing care, as prior work has found decreased cancer screening during economic downturns.  Studies have also documented increased utilization of emergency room (ER) visits among those who have been recently foreclosed upon and increased hospitalizations among the elderly during the most recent recession, suggesting worsened health.  Since this economic contraction was more severe than any since the Great Depression, researchers have hypothesized that the health impacts may be more dire than those of less severe recessions examined in recent decades.  Moreover, most of the extant research among subgroups focuses on the unemployed, with less research on the majority of the population that remains in the workforce.

Objective: In this study we examine trends in healthcare utilization among a panel of continuously employed, continuously insured workers at a large multi-site U.S. manufacturing firm that experienced widespread layoffs during the Great Recession.  

Methods: Using claims and administrative data from a panel of employees (N = 9,486), we analyze changes in the utilization of outpatient, ER, and inpatient services during 2006-2012.  We examine the temporal discontinuity in utilization before and after the economic crisis using segmented (piecewise) regressions, with fixed effects models at the individual level.  In addition to examining overall utilization trends, we compare individuals who were previously healthy to those who had health problems at the beginning of the study period.  To identify the effects of job insecurity on healthcare utilization, we compare individuals who worked at high- and low-layoff plants.  We conduct similar analyses among employees’ spouses (N = 5,281) and children (N = 6,132).

Results: We find a significant increase in utilization of outpatient and ER services in the panel as a whole during this period.  Those with previous health problems demonstrate significant increases in outpatient, ER, and inpatient visits compared to previously healthy employees.  Individuals working at high-layoff plants decrease their utilization of outpatient services, suggesting that they may have foregone preventive care, while demonstrating significant increases in ER visits.  We find similar patterns among employees’ families.  These findings are robust to several sensitivity analyses.  

Conclusions: Our results suggest changes in healthcare utilization and potentially adverse impacts on the health of U.S. working families during the Great Recession, especially among those with previous health problems and those experiencing higher levels of job insecurity.  Given that the majority of the U.S. population remained employed during the recession, our sample may be more representative of the working population than those of prior studies, and thus contributes to our understanding of the impacts of economic crises on population health and health spending.