Lost Jobs and Health Insurance: An Analysis of the Impact of Employment Volatility on Firm-Provided Health Insurance

55 Pages Posted: 3 Nov 2011  

Fredrik Andersson

Office of the Comptroller of the Currency (OCC)

Iben Bolvig

University of Aarhus

Matthew Freedman

University of California, Irvine - Department of Economics

Julia Lane

Wagner Graduate School of Public Service; Institute for the Study of Labor (IZA)

Date Written: November 2, 2011

Abstract

It is an established fact that there are high levels of employment volatility in the United States. Despite the importance of employer-provided benefits in the US health insurance system, the impact of prior job instability on one’s future ability to obtain insurance coverage is not well understood. This paper finds a negative relationship between the volatility of a worker’s employment and her likelihood of receiving firm-provided health insurance. Previous employment volatility reduces each of the four factors necessary to receive such insurance: a worker’s subsequent chances of getting a job, her chances of getting a job in a firm that offers coverage, her chances of staying with the firm long enough to become eligible for coverage, and her ability to take up insurance if offered. The most important impact is on the last: her ability to take up insurance if offered. Lack of employment is not the only, and not even the largest, barrier to individual coverage under this system. This finding has important policy implications, particularly given the recent tendency of employers to shift the cost of insurance premiums onto their employees.

Keywords: Employer-Provided Health Insurance, Employment Volatility, Job Instability

JEL Classification: J32, J63

Suggested Citation

Andersson, Fredrik and Bolvig, Iben and Freedman, Matthew and Lane, Julia, Lost Jobs and Health Insurance: An Analysis of the Impact of Employment Volatility on Firm-Provided Health Insurance (November 2, 2011). Applied Economics, Vol. 43, No. 32, 2011. Available at SSRN: https://ssrn.com/abstract=1953318

Per Fredrik Daniel Andersson (Contact Author)

Office of the Comptroller of the Currency (OCC) ( email )

400 7th St. SW
Washington, DC 20219-0001
United States
202-649-5528 (Phone)
571-465-3246 (Fax)

Iben Bolvig

University of Aarhus ( email )

Nordre Ringgade 1
DK-8000 Aarhus C, 8000
Denmark

Matthew Freedman

University of California, Irvine - Department of Economics ( email )

3151 Social Science Plaza
Irvine, CA 92697-5100
United States

Julia Lane

Wagner Graduate School of Public Service ( email )

The Puck Building
295 Lafayette Street, Second Floor
New York, NY 10012
United States

Institute for the Study of Labor (IZA) ( email )

P.O. Box 7240
Bonn, D-53072
Germany

HOME PAGE: http://www.iza.org

Paper statistics

Downloads
43
Abstract Views
1,035