The effects of the affordable care act dependent coverage mandate on parents’ labor market outcomes

Seonghoon Kim; Kanghyock Koh

doi:10.1016/j.labeco.2022.102128

The effects of the affordable care act dependent coverage mandate on parents’ labor market outcomes

Seonghoon Kim, Kanghyock Koh

Department of Economics

Research output: Contribution to journal › Article › peer-review

2 Citations (Scopus)

Abstract

We examine the labor market impacts of the Affordable Care Act dependent mandate (ACA-DM), which has significantly increased dependent children's health insurance coverage through parents’ employer-sponsored health benefits. Using data from the American Community Survey, we find that the ACA-DM reduced parents’ annual wages by about $2,600. However, the probability of employment and working hours only decreased marginally. The back-of-the-envelope calculation indicates that the magnitude of the estimated wage impact is similar to the increased insurance premium of a family plan due to the ACA-DM. These findings imply that a deadweight loss associated with the expansion of dependent health coverage is likely to be small as an increase in employers’ labor costs is offset by a reduction in parents’ wages without significant reductions in labor inputs.

Original language	English
Article number	102128
Journal	Labour Economics
Volume	75
DOIs	https://doi.org/10.1016/j.labeco.2022.102128
Publication status	Published - 2022 Apr

Bibliographical note

Funding Information:
We are grateful to the editor, two anonymous reviewers, Anna Aizer, Jon Gruber, Hyojin Han, Michelle Marcus, Xuan Zhang, and the seminar participants at the Korean Economic Association Annual Meeting, Sogang University, Kyunghee University, Korea University, the Asian Meeting of the Econometric Society, and the Asian Australian Society of Labour Economics for their useful comments. This work was supported by the Ministry of Education of the Republic of Korea and the National Research Foundation of Korea (NRF-2020S1A3A2A02104190). All errors are our own.

Funding Information:
We are grateful to the editor, two anonymous reviewers, Anna Aizer, Jon Gruber, Hyojin Han, Michelle Marcus, Xuan Zhang, and the seminar participants at the Korean Economic Association Annual Meeting, Sogang University, Kyunghee University, Korea University, the Asian Meeting of the Econometric Society, and the Asian Australian Society of Labour Economics for their useful comments. This work was supported by the Ministry of Education of the Republic of Korea and the National Research Foundation of Korea (NRF-2020S1A3A2A02104190). All errors are our own.

Publisher Copyright:
© 2022 Elsevier B.V.

Keywords

Deadweight loss
Dependent health insurance coverage
Parents’ labor market outcomes
The affordable care act dependent mandate

ASJC Scopus subject areas

Economics and Econometrics
Organizational Behavior and Human Resource Management

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Access to Document

10.1016/j.labeco.2022.102128

Cite this

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abstract = "We examine the labor market impacts of the Affordable Care Act dependent mandate (ACA-DM), which has significantly increased dependent children's health insurance coverage through parents{\textquoteright} employer-sponsored health benefits. Using data from the American Community Survey, we find that the ACA-DM reduced parents{\textquoteright} annual wages by about $2,600. However, the probability of employment and working hours only decreased marginally. The back-of-the-envelope calculation indicates that the magnitude of the estimated wage impact is similar to the increased insurance premium of a family plan due to the ACA-DM. These findings imply that a deadweight loss associated with the expansion of dependent health coverage is likely to be small as an increase in employers{\textquoteright} labor costs is offset by a reduction in parents{\textquoteright} wages without significant reductions in labor inputs.",

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The effects of the affordable care act dependent coverage mandate on parents’ labor market outcomes

Abstract

Bibliographical note

Keywords

ASJC Scopus subject areas

UN SDGs

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