Association of Financial Literacy With Hospitalization in Community-dwelling Older Adults

Background:Lowering the likelihood of hospitalization in older adults is a major public health goal for modern health care systems. Emerging data suggest that financial literacy is an important determinant of health outcomes in old age, but the relationship with hospitalization has not been explored.Objective:To test the hypothesis that better financial literacy is related to lower risk of hospitalization in older persons.Design:Prospective cohort study.Participants:Data came from community-dwelling older adults (n=388) without dementia enrolled in the Rush Memory and Aging Project.Main Measures:Participants underwent detailed assessment of financial literacy and cognition. Data on hospitalizations were obtained from linked Medicare claims records (MedPAR file).Results:Over an average of 1.8 years, 117 participants (30%) were hospitalized, and a third of those hospitalized experienced multiple hospitalizations. In a modified Poisson regression model adjusted for age, sex, education, and cognition, better financial literacy was associated with lower risk of hospitalization. In a model further adjusted for income, physical activity, body mass index, smoking, social network size, chronic conditions, basic and instrumental activities of daily living disability, and depressive symptoms, the association was unchanged. Secondary analyses showed the association was primarily driven by conceptual knowledge rather than numeracy.Conclusions:Higher financial literacy is related to a lower risk of hospitalization in older persons without dementia, after adjusting for cognitive, health, functional, and socioeconomic factors. The ability to understand and utilize financial concepts may represent a potentially modifiable risk factor for hospitalization in later life.