working-age population, and many live in families with children. Working-age families tend to be larger in size and have higher incomes than retired families, although their official poverty rates are higher compared with the elderly.4 Working-age families have more competing demands on their resources. For example, they typically incur work-related and childrearing expenses and spend more on transportation compared with older families. In addition, working-age families should be saving from current income for future retirement or to invest in the education of their children. On average, their health needs are lower than those of the elderly.
In contrast, most individuals ages 65 and over are retired or close to retirement, and few in this age group are still raising children. Upon retirement, individuals and families typically begin drawing down on their assets rather than continuing to save. In addition, the need for medical care grows as people age. The implication of these different consumption and saving patterns is that elderly and nonelderly families would be expected to devote different shares of family income to out-of-pocket medical care and health insurance premiums.
DATA AND METHODS
Using the Medical Expenditure Panel Survey
The Medical Expenditure Panel Survey (MEPS) includes detailed information on medical expenditures by source of payment, including out-of-pocket payments. Information is also collected on out-of-pocket premiums, income, assets, and other individual and household data. Although data on income and expenditures support annual estimates, the information on assets is collected only once per panel, at the end of the last round of data collection. In this paper, we pool three panels together in order to increase sample sizes for the elderly and self-employed and to support analyses of the distribution of assets across different poverty groups. In MEPS, a new panel is started each year. Panels 10, 11, and 12 started in 2005, 2006, and 2007, respectively. Because asset information is collected in the second year of the panel, all measures of assets and income are adjusted for inflation to bring them to 2008 using the Consumer Price Index for Urban Areas.
Although the MEPS asset variables are not currently available on public use files, they are available to any researcher to use in the Agency for Healthcare Research and Quality Data Center. The asset section of MEPS collects information on financial and nonfinancial assets. Information on debt is also collected. Financial assets include checking and savings ac-
4 As of 2010, 9.0 percent of persons ages 65 or older lived in poverty compared with 22.0 percent of children and 13.7 percent of nonelderly adults.