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Eligibility Recertification and Dynamic Opt-in Incentives in Income-tested Social Programs: Evidence from Medicaid/CHIP

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  • Zhuan Pei

    ()
    (Economics Department, Brandeis University)

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    Abstract

    Conventional labor supply studies assume the constant eligibility monitoring of income-tested program participants, but this is not true for most programs. For example, states can allow children to enroll in Medicaid/CHIP for 12 months regardless of family income changes. A long recertification period reduces monitoring costs but is predicted to induce program participation by temporary income adjustments. However, I find little evidence of strategic behavior from the Survey of Income and Program Participation. Given the lack of income responses, I propose a framework to compute the optimal recertification period and find 12 months to be its lower bound.

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    File URL: http://www.brandeis.edu/departments/economics/RePEc/brd/doc/Brandeis_WP61.pdf
    File Function: First version, 2013
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    Bibliographic Info

    Paper provided by Brandeis University, Department of Economics and International Businesss School in its series Working Papers with number 61.

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    Length: 50 pages
    Date of creation: Aug 2013
    Date of revision:
    Handle: RePEc:brd:wpaper:61

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    Postal: MS032, P.O. Box 9110, Waltham, MA 02454-9110
    Web page: http://www.brandeis.edu/departments/economics/
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    Related research

    Keywords: Labor Supply; Medicaid; CHIP; Continuous Eligibility; Recertification;

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    References

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    1. Ham, John C. & Shore-Sheppard, Lara, 2005. "The effect of Medicaid expansions for low-income children on Medicaid participation and private insurance coverage: evidence from the SIPP," Journal of Public Economics, Elsevier, vol. 89(1), pages 57-83, January.
    2. Bernard SalaniƩ, 2003. "The Economics of Taxation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262194864, December.
    3. John C. Ham & Xianghong Li & Lara Shore-Sheppard, 2009. "Seam Bias, Multiple-State, Multiple-Spell Duration Models and the Employment Dynamics of Disadvantaged Women," NBER Working Papers 15151, National Bureau of Economic Research, Inc.
    4. A. S. Yelowitz, . "The Medicaid notch, labor supply, and welfare participation: Evidence from eligibility expansions," Institute for Research on Poverty Discussion Papers 1084-96, University of Wisconsin Institute for Research on Poverty.
    5. Bruce D. Meyer & Dan T. Rosenbaum, 2001. "Welfare, The Earned Income Tax Credit, And The Labor Supply Of Single Mothers," The Quarterly Journal of Economics, MIT Press, vol. 116(3), pages 1063-1114, August.
    6. MaCurdy, Thomas E, 1981. "An Empirical Model of Labor Supply in a Life-Cycle Setting," Journal of Political Economy, University of Chicago Press, vol. 89(6), pages 1059-85, December.
    7. Heckman, James J. & Robb, Richard Jr., 1985. "Alternative methods for evaluating the impact of interventions : An overview," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 239-267.
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