The TIAA-CREF Institute presented the 2008 TIAA-CREF Paul A. Samuelson Award for Outstanding Scholarly Writing on Lifelong Financial Security to Jeffrey R. Brown, William G. Karnes Professor of Finance, College of Business, University of Illinois at Urbana-Champaign and Amy Finkelstein, Professor of Economics, Massachusetts Institute of Technology for their ground-breaking paper, "The Interaction of Public and Private Insurance: Medicaid and the Long-Term Care Insurance Market."
Long-term healthcare represents a significant financial burden as America ages, and constitutes about 8.5 percent of total health expenditures, the paper shows. Yet, it is one of the largest uninsured financial risks seniors face today.
The authors examine why many seniors who face significant financial long-term care expenditure risk do not purchase private insurance. Fundamental new insights revealed by Brown and Finkelstein show that the Medicaid program is responsible for most of the lack of demand for private long-term care insurance.
Brown and Finkelstein's findings suggest that in the absence of substantial Medicaid reform, households should save more in their retirement plans and rely on other types of tax-preferred savings programs to ensure that long-term care needs are covered.
2008 Panel of Distinguished Judges
- Leora Friedberg, Ph.D., Associate Professor of Economics, University of Virginia
- Erik Hurst, Ph.D., Professor of Economics and Neubauer Family Faculty Fellow, University of Chicago, Graduate School of Business
- John Karl Scholz, Ph.D., Professor of Economics, University of Wisconsin-Madison
- Jack VanDerhei, Ph.D., Director of Research, Employee Benefit Research Institute
- Luis Viceira, Ph.D., George E. Bates Professor, Harvard Business School