IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v30y2021i3p491-504.html
   My bibliography  Save this article

What happens when you wait? Effects of Social Security Disability Insurance wait time on health and financial well‐being

Author

Listed:
  • Sarah Prenovitz

Abstract

While waiting for a decision, individuals who apply for Social Security Disability Insurance face strong incentives to remain out of the labor force and receive no support from the program. An extended period with low income, high uncertainty, and lowered access to health insurance has the potential to harm applicants' well‐being along many dimensions. In this study, I estimate the effect of initial wait time on health, healthcare access, and financial well‐being, using the prevailing wait at the time an applicant applied as an instrument for their own initial wait. I find that a longer wait decreases the likelihood that an applicant has benefits terminated at the time of survey and increases the likelihood that they are currently receiving benefits, consistent with prior findings that longer waits decrease future work and earnings. Wait time also increases the number of conditions causing activity limitations. This suggests that new or worsening medical conditions contribute to the effect of wait time on employment and earnings, and that wait time has effects that extend beyond labor force outcomes.

Suggested Citation

  • Sarah Prenovitz, 2021. "What happens when you wait? Effects of Social Security Disability Insurance wait time on health and financial well‐being," Health Economics, John Wiley & Sons, Ltd., vol. 30(3), pages 491-504, March.
    • Handle: RePEc:wly:hlthec:v:30:y:2021:i:3:p:491-504
    DOI: 10.1002/hec.4203
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.4203
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.4203?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Chen, Susan & van der Klaauw, Wilbert, 2008. "The work disincentive effects of the disability insurance program in the 1990s," Journal of Econometrics, Elsevier, vol. 142(2), pages 757-784, February.
    2. Alexander Gelber & Timothy J. Moore & Alexander Strand, 2017. "The Effect of Disability Insurance Payments on Beneficiaries' Earnings," American Economic Journal: Economic Policy, American Economic Association, vol. 9(3), pages 229-261, August.
    3. Bound, John, 1989. "The Health and Earnings of Rejected Disability Insurance Applicants," American Economic Review, American Economic Association, vol. 79(3), pages 482-503, June.
    4. David Card & Carlos Dobkin & Nicole Maestas, 2009. "Does Medicare Save Lives?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 597-636.
    5. David H. Autor & Mark G. Duggan, 2003. "The Rise in the Disability Rolls and the Decline in Unemployment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(1), pages 157-206.
    6. Moore, Timothy J., 2015. "The employment effects of terminating disability benefits," Journal of Public Economics, Elsevier, vol. 124(C), pages 30-43.
    7. Amy Finkelstein & Sarah Taubman & Bill Wright & Mira Bernstein & Jonathan Gruber & Joseph P. Newhouse & Heidi Allen & Katherine Baicker, 2012. "The Oregon Health Insurance Experiment: Evidence from the First Year," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(3), pages 1057-1106.
    8. repec:mpr:mprres:7005 is not listed on IDEAS
    9. Garcia-Gomez, Pilar & Gielen, Anne C., 2014. "Health Effects of Containing Moral Hazard: Evidence from Disability Insurance Reform," IZA Discussion Papers 8386, Institute of Labor Economics (IZA).
    10. Eric French & Jae Song, 2014. "The Effect of Disability Insurance Receipt on Labor Supply," American Economic Journal: Economic Policy, American Economic Association, vol. 6(2), pages 291-337, May.
    11. Norma B. Coe & Stephan Lindner & Kendrew Wong & April Yanyuan Wu, 2013. "How Do the Disabled Cope While Waiting for SSDI?," Working Papers, Center for Retirement Research at Boston College wp2013-12, Center for Retirement Research.
    12. Nicole Maestas & Kathleen J. Mullen & Alexander Strand, 2013. "Does Disability Insurance Receipt Discourage Work? Using Examiner Assignment to Estimate Causal Effects of SSDI Receipt," American Economic Review, American Economic Association, vol. 103(5), pages 1797-1829, August.
    13. repec:mpr:mprres:6274 is not listed on IDEAS
    14. Gross, Tal & Notowidigdo, Matthew J., 2011. "Health insurance and the consumer bankruptcy decision: Evidence from expansions of Medicaid," Journal of Public Economics, Elsevier, vol. 95(7-8), pages 767-778, August.
    15. Currie, Janet & Gruber, Jonathan, 1996. "Saving Babies: The Efficacy and Cost of Recent Changes in the Medicaid Eligibility of Pregnant Women," Journal of Political Economy, University of Chicago Press, vol. 104(6), pages 1263-1296, December.
    16. repec:mpr:mprres:7006 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Chris Sampson’s journal round-up for 8th March 2021
      by Chris Sampson in The Academic Health Economists' Blog on 2021-03-08 12:00:01

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Engin Üngüren & Ömer Akgün Tekin & Hüseyin Avsallı & Yaşar Yiğit Kaçmaz, 2021. "The Moderator Role of Financial Well-Being on the Effect of Job Insecurity and the COVID-19 Anxiety on Burnout: A Research on Hotel-Sector Employees in Crisis," Sustainability, MDPI, vol. 13(16), pages 1-20, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liebert, Helge, 2019. "Does external medical review reduce disability insurance inflow?," Journal of Health Economics, Elsevier, vol. 64(C), pages 108-128.
    2. Andreas Haller & Stefan Staubli & Josef Zweimüller, 2024. "Designing Disability Insurance Reforms: Tightening Eligibility Rules or Reducing Benefits?," Econometrica, Econometric Society, vol. 92(1), pages 79-110, January.
    3. Moore, Timothy J., 2015. "The employment effects of terminating disability benefits," Journal of Public Economics, Elsevier, vol. 124(C), pages 30-43.
    4. Deuchert, Eva & Eugster, Beatrix, 2019. "Income and substitution effects of a disability insurance reform," Journal of Public Economics, Elsevier, vol. 170(C), pages 1-14.
    5. Katharine G. Abraham & Melissa S. Kearney, 2020. "Explaining the Decline in the US Employment-to-Population Ratio: A Review of the Evidence," Journal of Economic Literature, American Economic Association, vol. 58(3), pages 585-643, September.
    6. David H. Autor & Mark Duggan & Kyle Greenberg & David S. Lyle, 2016. "The Impact of Disability Benefits on Labor Supply: Evidence from the VA's Disability Compensation Program," American Economic Journal: Applied Economics, American Economic Association, vol. 8(3), pages 31-68, July.
    7. Nicolas R. Ziebarth, 2018. "Social Insurance and Health," Contributions to Economic Analysis, in: Health Econometrics, volume 127, pages 57-84, Emerald Group Publishing Limited.
    8. Garcia-Mandicó, Sílvia & García-Gómez, Pilar & Gielen, Anne C. & O’Donnell, Owen, 2020. "Earnings responses to disability insurance stringency," Labour Economics, Elsevier, vol. 66(C).
    9. Alexander Gelber & Timothy J. Moore & Alexander Strand, 2017. "The Effect of Disability Insurance Payments on Beneficiaries' Earnings," American Economic Journal: Economic Policy, American Economic Association, vol. 9(3), pages 229-261, August.
    10. Koning, Pierre & van Sonsbeek, Jan-Maarten, 2017. "Making disability work? The effects of financial incentives on partially disabled workers," Labour Economics, Elsevier, vol. 47(C), pages 202-215.
    11. Burns, Marguerite & Dague, Laura, 2017. "The effect of expanding Medicaid eligibility on Supplemental Security Income program participation," Journal of Public Economics, Elsevier, vol. 149(C), pages 20-34.
    12. Shu, Pian, 2015. "Asset accumulation and labor force participation of disability insurance applicants," Journal of Public Economics, Elsevier, vol. 129(C), pages 26-40.
    13. Koning Pierre & Vethaak Heike, 2021. "Decomposing Employment Trends of Disabled Workers," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 21(4), pages 1217-1255, October.
    14. Hjellset Alne, Ragnar, 2018. "Economic incentives, disability insurance and labor supply," Working Papers in Economics 2/18, University of Bergen, Department of Economics, revised 14 Jun 2018.
    15. Sylvain Chareyron & Naomie Mahmoudi, 2022. "The effects of disability benefits on the employment of low-skilled youth: Evidence from France," Erudite Working Paper 2022-09, Erudite.
    16. Raj Chetty & Amy Finkelstein, 2012. "Social Insurance: Connecting Theory to Data," NBER Working Papers 18433, National Bureau of Economic Research, Inc.
    17. Koning, Pierre & Muller, Paul & Prudon, Roger, 2022. "Do disability benefits hinder work resumption after recovery?," Journal of Health Economics, Elsevier, vol. 82(C).
    18. Tobias Müller & Stefan Boes, 2020. "Disability insurance benefits and labor supply decisions: evidence from a discontinuity in benefit awards," Empirical Economics, Springer, vol. 58(5), pages 2513-2544, May.
    19. Andreas Ravndal Kostol & Magne Mogstad, 2014. "How Financial Incentives Induce Disability Insurance Recipients to Return to Work," American Economic Review, American Economic Association, vol. 104(2), pages 624-655, February.
    20. Jeffrey Hemmeter & Michelle Stegman Bailey, 2016. "Earnings after DI: evidence from full medical continuing disability reviews," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-22, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:30:y:2021:i:3:p:491-504. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.