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Who pays the high health costs of older workers? Evidence from prostate cancer screening mandates


  • James Bailey


Between 1992 and 2009, 30 US states adopted laws mandating that health insurance plans cover screenings for prostate cancer. Because prostate cancer screenings are used almost exclusively by men over age 50, these mandates raise the cost of insuring older men relative to other groups. This article uses a triple-difference empirical strategy to take advantage of this quasi-random natural experiment in raising the cost of employing older workers. Using Integrated Public Use Microdata Series data from the March Supplement of the Current Population Survey, I find that the increased cost of insuring older workers results in their receiving 2.8% lower hourly wages, being 2% less likely to be employed and being 0.7% less likely to have employer-sponsored health insurance.

Suggested Citation

  • James Bailey, 2014. "Who pays the high health costs of older workers? Evidence from prostate cancer screening mandates," Applied Economics, Taylor & Francis Journals, vol. 46(32), pages 3931-3941, November.
  • Handle: RePEc:taf:applec:v:46:y:2014:i:32:p:3931-3941
    DOI: 10.1080/00036846.2014.948673

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    References listed on IDEAS

    1. James Bailey & Douglas Webber, 2017. "The political roots of health insurance benefit mandates," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 44(2), pages 170-182, May.
    2. David H. Autor, 2003. "Outsourcing at Will: The Contribution of Unjust Dismissal Doctrine to the Growth of Employment Outsourcing," Journal of Labor Economics, University of Chicago Press, vol. 21(1), pages 1-42, January.
    3. Cseh Attila, 2008. "Labor Market Consequences of State Mental Health Parity Mandates," Forum for Health Economics & Policy, De Gruyter, vol. 11(2), pages 1-34, April.
    4. Bound, John & Schoenbaum, Michael & Stinebrickner, Todd R. & Waidmann, Timothy, 1999. "The dynamic effects of health on the labor force transitions of older workers," Labour Economics, Elsevier, vol. 6(2), pages 179-202, June.
    5. Kowalski Amanda E. & Congdon William J. & Showalter Mark H., 2008. "State Health Insurance Regulations and the Price of High-Deductible Policies," Forum for Health Economics & Policy, De Gruyter, vol. 11(2), pages 1-26, November.
    6. David N van der Goes & Justin Wang & Katharine C Wolchik, 2011. "Effect of State Health Insurance Mandates on Employer-provided Health Insurance," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 37(4), pages 437-449.
    7. Depew, Briggs & Bailey, James, 2015. "Did the Affordable Care Act's dependent coverage mandate increase premiums?," Journal of Health Economics, Elsevier, vol. 41(C), pages 1-14.
    8. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(1), pages 249-275.
    9. James Bailey, 2013. "The Effect of Health Insurance Benefit Mandates on Premiums," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 40(1), pages 119-127, December.
    10. Stephan F. Gohmann, 2009. "The Effect of State Mandates on Health Insurance Premiums," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 24(Spring 20), pages 59-73.
    11. Thomas C. Buchmueller & John DiNardo & Robert G. Valletta, 2011. "The Effect of an Employer Health Insurance Mandate on Health Insurance Coverage and the Demand for Labor: Evidence from Hawaii," American Economic Journal: Economic Policy, American Economic Association, vol. 3(4), pages 25-51, November.
    12. Frank A. Scott & Mark C. Berger & John E. Garen, 1995. "Do Health Insurance and Pension Costs Reduce the Job Opportunities of Older Workers?," ILR Review, Cornell University, ILR School, vol. 48(4), pages 775-791, July.
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    Cited by:

    1. Osmani, Ahmad Reshad & Okunade, Albert A., 2019. "Cancer survivors in the labor market: Evidence from recent US micro-panel data," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 80, pages 202-221.
    2. Bailey, James, 2013. "Who pays for obesity? Evidence from health insurance benefit mandates," Economics Letters, Elsevier, vol. 121(2), pages 287-289.
    3. Conor Lennon, 2019. "Employer‐Sponsored Health Insurance and the Gender Wage Gap: Evidence from the Employer Mandate," Southern Economic Journal, John Wiley & Sons, vol. 85(3), pages 742-765, January.
    4. Lennon, Conor, 2022. "Employer-sponsored health insurance and labor market outcomes for men in same-sex couples: Evidence from the advent of pre-exposure prophylaxis," Economics & Human Biology, Elsevier, vol. 47(C).
    5. James Bailey, 2022. "State Health Insurance Benefit Mandates and Health Care Affordability," JRFM, MDPI, vol. 15(2), pages 1-10, February.
    6. Conor Lennon, 2018. "Who pays for the medical costs of obesity? New evidence from the employer mandate," Health Economics, John Wiley & Sons, Ltd., vol. 27(12), pages 2016-2029, December.
    7. Solomon, Keisha T. & Dasgupta, Kabir, 2022. "State mental health insurance parity laws and college educational outcomes," Journal of Health Economics, Elsevier, vol. 86(C).
    8. Lennon, Conor, 2021. "Are the costs of employer-sponsored health insurance passed on to workers at the individual level?," Economics & Human Biology, Elsevier, vol. 41(C).

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    More about this item

    JEL classification:

    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private


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