Health Status Is Associated with Income, Not Health Insurance

An extremely thorough analysis of changes in incomes and mortality in the United States, 2001 through 2014, presents sobering findings for those who think fixing our health system will make us healthier. The study, let by Raj Chetty of Stanford University, ran data on incomes and mortality through a battery of statistical tools.

It is well understood that people in high-income households are healthier than those in low-income households. The latest research demonstrates how important incomes are to health status. Forty-year old men in households in the highest quartile of income (mean = $256,000 annually) had an average life expectancy just under 85 years in 2001. This increased by 0.20 years (a little over ten weeks) by 2014. For those in the lowest quartile ($17,000), life expectancy was about 76 years in 2001, and it increased only 0.08 years (a little over four weeks) by 2014.

Obamacare is likely to accelerate this gap, because it significantly reduces incentives for people in low-income households to increase their incomes.

The research really gets interesting when it explores other factors explaining lifespan. Unsurprisingly, smoking, obesity, and exercise were moderately significant factors for people at all income levels. However, other factors had opposite effects at higher incomes than lower incomes.

The researchers looked at lifespans in different areas of the country, by quartile. In the top income quartile, the uninsured rate was moderately associated with shorter lifespans, as was Medicare spending and hospital mortality, whereas access to preventive care and “social capital” were moderately associated with longer lifespans. Income inequality (within the quartile), unemployment, and immigrants were moderately associated with shorter lifespans.

However, when it comes to the bottom quintile, neither the proportion of uninsured, nor Medicare spending, nor preventive care had a significant relationship with lifespans. Counter-intuitively: Income inequality and unemployment had a marginally positive relationship with longer lifespans, whereas “social capital” had a marginally negative relationship. The single strongest favorable factor was the proportion of immigrants. It is likely that immigrants to low-income neighborhoods were healthier than the native born.

These findings lead to dramatic policy conclusions: Getting health insurance to people in low-income households is not important for their longevity. More important is allowing them opportunities to increase their incomes. That would be the opposite of Obamacare.

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For the pivotal alternative to Obamacare, please see the Independent Institute’s widely acclaimed book: Priceless: Curing the Healthcare Crisis, by John C. Goodman.