Michael F. Cannon
I surprised a reporter recently. She asked what policymakers can do to make long-term care more affordable. I imagine she was expecting a health policy answer; maybe Medicaid something something. I replied, “Dramatically liberalize immigration.”
A new study suggests I was onto something. David Grabowski, Jonathan Gruber, and Brian McGarry find that greater immigration leads to less nursing-home use, presumably by making in-home care more affordable. And that’s not all:
We find a strong impact of immigration on the size of the immigrant care workforce: admitting 1,000 new immigrants would lead to 142 new foreign healthcare workers, without evidence of crowd out of native health care workers. We also find striking effects on mortality: a 25% increase in the steady state flow of immigrants to the US would result in 5,000 fewer deaths nationwide. We identify reduced use of nursing homes as a key mechanism driving this result.…
Importantly, we find little evidence of a “crowd-out” of domestic health care workers; indeed, we find crowd-in of domestic physicians, perhaps reflecting the ability to deliver additional care with more lower-skilled foreign workers available. On net, we estimate that 1,000 new immigrants would lead to 173 more healthcare workers of any origin, including 96 new aides, nurses and doctors.…
We also find that increased immigration leads to a clearly identified reduction in the use of skilled nursing facilities (SNFs), consistent with the earlier studies showing that the availability of immigrant labor reduces the number of older adults residing in an institution.… Additionally, we provide evidence that reductions in SNF use are not just allowing older adults to age in their preferred setting but are intertwined with meaningful improvements in the health of older adults.…
Taken together, we find that immigration saves elderly lives, and these health improvements may come through protective effects of avoiding the nursing home setting and through better treatment of those who go to nursing homes.