Publications
The Impact of Financial Assistance Programs on Health Care Utilization (with Alyce Adams, Raymond Kluender, Neale Mahoney, Jinglin Wang, and Wesley Yin)
American Economic Review: Insights 4(3), September 2022: 389-407.
Trends in Medical Debt During the COVID-19 Pandemic (with Benedict Guttman-Kenney, Raymond Kluender, Neale Mahoney, Xuyang Xia, and Wesley Yin)
JAMA Health Forum 3(5):e221031, May 2022.
Medical Debt in the US, 2009-2020 (with Raymond Kluender, Neale Mahoney, and Wesley Yin)
JAMA 326(3), July 2021.
Press Coverage: New York Times, Washington Post, Vox, MarketWatch, CBS, Marketplace
Working Papers
The Effects of Medical Debt Relief: Evidence from Two Randomized Experiments (with Raymond Kluender, Neale Mahoney, and Wesley Yin)
Accepted, Quarterly Journal of Economics
Links: NBER Working Paper no. 32315
Abstract: Two in five Americans have medical debt, nearly half of whom owe at least $2,500. Concerned by this burden, governments and private donors have undertaken large, high-profile efforts to relieve medical debt. We partnered with RIP Medical Debt (now Undue Medical Debt) to conduct two randomized experiments that relieved medical debt with a face value of $169 million for 83,401 people between 2018 and 2020. Our experiments focused on downstream medical debt that had been sold to debt collectors, and one of our experiments straddled an industry-wide pullback in the reporting of medical debt to the credit bureaus, allowing us to estimate the effects of debt relief with and without counterfactual reporting. We track outcomes using credit reports, collections account data, and a multimodal survey. There are three sets of results. First, we find a modest improvement in credit access when there is counterfactual credit reporting, but no impact on credit report outcomes when there is not. Second, we estimate that debt relief causes a moderate but statistically significant reduction in payments of existing medical bills. Third, we find no effects on survey measures of mental and physical health, healthcare utilization, and financial wellness. Taken together, our results indicate that the strong correlations documented in prior research do not translate into causal effects for downstream medical debt relief.
Press Coverage: New York Times, The Guardian, Forbes, Vox, Bloomberg, The Atlantic
Racial Disparities in Housing Returns (with Amir Kermani)
Conditionally accepted, American Economic Review
Links: NBER Working Paper no. 29306
Abstract: We document the existence of a racial gap in realized housing returns that is an order of magnitude larger than disparities arising from housing costs alone, and is driven by differences in distressed home sales (i.e., foreclosures and short sales). Black and Hispanic homeowners are both more likely to experience a distressed sale and to live in neighborhoods where distressed sales erase more house value. However, absent financial distress, houses owned by minorities do not appreciate at substantially slower rates than houses owned by non-minorities. Racial differences in liquid wealth and income stability are important determinants of differences in distress.
Press Coverage: Mother Jones
Taxing Homeowners Who Won't Borrow
Links: CESifo Working Paper No. 11185
Abstract: Using high-frequency administrative data covering millions of US homeowners, I document three novel facts about homeowner responses to property tax increases driven by rising home values. First, non-migrating homeowners cut consumption, exhibit financial distress, and do not borrow against their higher home values. These responses run contrary to the predictions of frictionless models, in which homeowners should borrow to avoid costly adjustments. Second, heterogeneity analysis shows that consumption responses do not vary by liquidity, consistent with savings target behavior. In contrast, distress responses are concentrated among liquidity-constrained homeowners. Many homeowners report being debt averse and therefore unwilling to borrow in order to avoid illiquidity and distress. Third, tax hikes induce migration—partly by displacing illiquid homeowners—but do not accelerate neighborhood change. A simple welfare framework reveals that the largest costs of property taxes arise from financial distress among liquidity-constrained homeowners.
Mad as Hell: Property Taxes and Financial Distress
Abstract: Property taxes are uniquely unpopular and have been curtailed in 46 US states. This study tests whether property tax animus occurs when rising home values raise tax bills and create financial distress. Consistent with this channel, property taxes are more unpopular when governments do not limit how much rising home values can raise taxes. Financial distress is a key correlate of property tax animus in both survey responses and real-world voting behavior. Randomized information treatments indicate that distortionary income-based tax relief reduces property tax animus, suggesting that politically sustainable property taxes require distortionary modifications that mitigate financial distress.