State Health Insurance Mandates and Labor Market Outcomes: New Evidence on Old Questions

Abstract

We re-visit the relationship between private health insurance mandates, access to employer-sponsored health insurance, and labor market outcomes using the National Longitudinal Survey of Youth 1979. We model employer-sponsored health insurance access and labor market outcomes across the lifecycle as a function of the number of high cost mandates in place at labor market entrance. We find no evidence that high cost state health insurance mandates discourage employers from offering insurance to employees. Employers adjust wages and labor demand to offset mandate costs. Mandate effects are persistent but not permanent. We document heterogeneity across worker-types.

Keywords: mandated benefits, labor costs, health insurance, persistence

JEL Classification: H2, I13, J3