Health Care Expenditures and Longevity: Is there a Eubie Blake Effect? Health Care Expenditures and Longevity: Is there a Eubie Blake Effect? Health Care Expenditures and Longevity: Is there a Eubie Blake Effect?

Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Abstract It is still an open question whether increasing life expectancy as such is causing higher health care expenditures (HCE). According to the "red-herring"-hypothesis, the positive correlation between age and HCE is exclusively due to the fact that mortality rises with age and a large share of HCE is caused by proximity to death. As a consequence, rising longevitythrough falling mortality rates -may even reduce HCE. However, a weakness of previous empirical studies is that they use cross-sectional evidence to make inferences on a development over time. In this paper we try to isolate the impact of rising longevity on the trend of HCE over time by using data for a pseudo-panel of German sickness fund members over the period [1997][1998][1999][2000][2001][2002][2003][2004][2005][2006][2007][2008][2009]. Using dynamic panel data models, we find that age, mortality rate and five-year survival rates have a positive impact on per-capita HCE. Our explanation for the last finding is that physicians treat patients more aggressively if they think the result will pay off for a longer time span, which we call "Eubie Blake effect". A simulation on the basis of an official population forecast for Germany is used to isolate the effect of demographic ageing on real per-capita HCE over the next decades. JEL-classification: H51, J11, I19