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Moral Hazard and Disability Insurance: On the Incidence of Hard-to-Diagnose Medical Conditions in the Canada/Quebec Pension Plan Disability Program

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  • Michele Campolieti
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    Abstract

    This paper examines the prevalence of hard-to-diagnose conditions, such as musculoskeletal disorders, in the Canada/Quebec Pension Plan (C/QPP) disability program. Specifically, it uses aggregate data to study the effect of disability benefits and an increase in the rigour of the medical screening on the composition of the medical conditions on the C/QPP's disability rolls. The empirical findings from this paper suggest that the increased generosity of disability benefits has contributed to the increase in the incidence of musculoskeletal conditions on the disability rolls. Furthermore, the increased rigour of the medical screening has induced a reduction in the incidence of musculoskeletal conditions on the disability rolls in recent years.

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    Bibliographic Info

    Article provided by University of Toronto Press in its journal Canadian Public Policy.

    Volume (Year): 28 (2002)
    Issue (Month): 3 (September)
    Pages: 419-441

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    Handle: RePEc:cpp:issued:v:28:y:2002:i:3:p:419-441

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    1. Campolieti, Michele, 2001. " Recurrence in Workers' Compensation Claims: Estimates from a Multiple Spell Hazard Model," Journal of Risk and Uncertainty, Springer, Springer, vol. 23(1), pages 75-94, July.
    2. Jonathan Gruber, 1996. "Disability Insurance Benefits and Labor Supply," NBER Working Papers 5866, National Bureau of Economic Research, Inc.
    3. Christopher J. Ruhm, 1996. "Are Recessions Good For Your Health?," NBER Working Papers 5570, National Bureau of Economic Research, Inc.
    4. Brooker, Ann-Sylvia & Frank, John W. & Tarasuk, Valerie S., 1997. "Back pain claim rates and the business cycle," Social Science & Medicine, Elsevier, Elsevier, vol. 45(3), pages 429-439, August.
    5. Dionne, Georges & St-Michel, Pierre, 1991. "Workers' Compensation and Moral Hazard," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 236-44, May.
    6. David Card & Brian P. McCall, 1994. "Is Workers' Compensation Covering Uninsured Medical Costs? Evidence from the 'Monday Effect'," Working Papers, Princeton University, Department of Economics, Industrial Relations Section. 706, Princeton University, Department of Economics, Industrial Relations Section..
    7. Jonathan Gruber & Jeffrey D. Kubik, 1994. "Disability Insurance Rejection Rates and the Labor Supply of Older Workers," NBER Working Papers 4941, National Bureau of Economic Research, Inc.
    8. Kreider, Brent, 1999. "Social Security Disability Insurance: Applications, Awards, and Lifetime Income Flows," Staff General Research Papers, Iowa State University, Department of Economics 5188, Iowa State University, Department of Economics.
    9. Butler, Richard J & Durbin, David L & Helvacian, Nurhan M, 1996. "Increasing Claims for Soft Tissue Injuries in Workers' Compensation: Cost Shifting and Moral Hazard," Journal of Risk and Uncertainty, Springer, Springer, vol. 13(1), pages 73-87, July.
    10. Gruber, Jonathan & Kubik, Jeffrey D., 1997. "Disability insurance rejection rates and the labor supply of older workers," Journal of Public Economics, Elsevier, Elsevier, vol. 64(1), pages 1-23, April.
    11. Parsons, Donald O, 1991. "Self-Screening in Targeted Public Transfer Programs," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 99(4), pages 859-76, August.
    12. Kreider, Brent & Riphahn, Regina T., 1998. "Applications to the U.S. Disability System: A Semiparametric Approach for Men and Women," IZA Discussion Papers 17, Institute for the Study of Labor (IZA).
    13. Rea, Samuel A, Jr, 1981. "Workmen's Compensation and Occupational Safety under Imperfect Information," American Economic Review, American Economic Association, American Economic Association, vol. 71(1), pages 80-93, March.
    14. Bound, John & Burkhauser, Richard V., 1999. "Economic analysis of transfer programs targeted on people with disabilities," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 51, pages 3417-3528 Elsevier.
    15. Bound, John, 1991. "The Health and Earnings of Rejected Disability Insurance Applicants: Reply," American Economic Review, American Economic Association, American Economic Association, vol. 81(5), pages 1427-34, December.
    16. Baker, Michael & Benjamin, Dwayne, 1999. "Early Retirement Provisions and the Labor Force Behavior of Older Men: Evidence from Canada," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 17(4), pages 724-56, October.
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