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Lost jobs and health insurance: an analysis of the impact of employment volatility on firm-provided health insurance


  • Fredrik Andersson
  • Iben Bolvig
  • Matthew Freedman
  • Julia Lane


It is an established fact that there are high levels of employment volatility in the US. Despite the importance of employer-provided benefits in the US health insurance system the impact of prior job instability on one's future ability to obtain insurance coverage is not well understood. This article finds a negative relationship between the volatility of a worker's employment and her likelihood of receiving firm-provided health insurance. Previous employment volatility reduces each of the four factors necessary to receive such insurance: a worker's subsequent chances of getting a job, her chances of getting a job in a firm that offers coverage, her chances of staying with the firm long enough to become eligible for coverage and her ability to take up insurance if offered. The most important impact is on the last: her ability to take up insurance if offered. Lack of employment is not the only, and not even the largest, barrier to individual coverage under this system. This finding has important policy implications, particularly given the recent tendency of employers to shift the cost of insurance premiums onto their employees.

Suggested Citation

  • Fredrik Andersson & Iben Bolvig & Matthew Freedman & Julia Lane, 2011. "Lost jobs and health insurance: an analysis of the impact of employment volatility on firm-provided health insurance," Applied Economics, Taylor & Francis Journals, vol. 43(23), pages 3051-3073.
  • Handle: RePEc:taf:applec:v:43:y:2011:i:23:p:3051-3073
    DOI: 10.1080/00036840903427232

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    References listed on IDEAS

    1. Lechner, Michael, 1999. "Identification and Estimation of Causal Effects of Multiple Treatments Under the Conditional Independence Assumption," IZA Discussion Papers 91, Institute for the Study of Labor (IZA).
    2. David M. Cutler, 2003. "Employee Costs and the Decline in Health Insurance Coverage," NBER Chapters,in: Frontiers in Health Policy Research, Volume 6, pages 27-54 National Bureau of Economic Research, Inc.
    3. Janet Currie & Aaron S. Yelowitz, 1999. "Health Insurance and Less Skilled Workers," JCPR Working Papers 63, Northwestern University/University of Chicago Joint Center for Poverty Research.
    4. Martha Stinson, 2002. "Estimating the Relationship between Employer-Provided Health Insurance, Worker Mobility, and Wages," Longitudinal Employer-Household Dynamics Technical Papers 2002-23, Center for Economic Studies, U.S. Census Bureau, revised Jun 2003.
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