Discharge on the day of birth, parental response and health and schooling outcomes

•We investigate the effects of mandated discharge on the day of birth for uncomplicated multiparous births.•Being discharged on the day of birth causes a higher probability of hospital readmission in the first month after birth and a lower 9th grade GPA.•The long-run effects are driven by an “at-risk-group” of children and mothers.•Being discharged on the day of birth also affects parental investment and medium-run health outcomes for the “at-risk-group”. Exploiting the Danish roll-out of same-day discharge policies after uncomplicated births, we find that treated newborns have a higher probability of hospital readmission in the first month after birth. While these short-run effects may indicate substitution of hospital stays with readmissions, we also find that—in the longer run—a same-day discharge decreases children's 9th grade GPA. This effect is driven by children and mothers, who prior to the policy change would have been least likely to experience a same-day discharge. Using administrative and survey data to assess potential mechanisms, we show that a same-day discharge impacts those parents’ health investments and their children's medium-run health. Our findings point to important negative effects of policies that expand same-day discharge policies to broad populations of mothers and children.