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Limited Insurance Portability and Job Mobility: The Effects of Public Policy on Job-Lock

  • Gruber, J.
  • Madrian, B.C.

The link between health insurance and the workplace in the U.S. has led to concern over the possibility of insurance-induced reductions in job mobility or 'job-lock". Designing health insurance reforms which retain employer-based insurance coverage but mitigate the extent of job-lock requires an understanding of the policy dimensions to which job-lock is most receptive. We study a policy of limited insurance portability which has been adopted by a number of states and the federal government over the last 20 years. These "continuation of coverage' mandates grant individuals the right to continue purchasing health insurance through their former employers for some period of time after leaving their jobs. We find that the passage of these mandates caused a significant increase in the job mobility of prime age male workers. This suggests that a sizeable share of job-lock arises from short run concerns over portability rather than from long run problems.

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Paper provided by Massachusetts Institute of Technology (MIT), Department of Economics in its series Working papers with number 94-03.

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Length: 29 pages
Date of creation: 1994
Date of revision:
Handle: RePEc:mit:worpap:94-03
Phone: (617) 253-3361
Fax: (617) 253-1330
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  1. Gruber, J., 1992. "State Mandated Benefits and Employer Provided Health Insurance," Working papers 92-18, Massachusetts Institute of Technology (MIT), Department of Economics.
  2. Madrian, Brigitte C, 1994. "Employment-Based Health Insurance and Job Mobility: Is There Evidence of Job-Lock?," The Quarterly Journal of Economics, MIT Press, vol. 109(1), pages 27-54, February.
  3. Ann P. Bartel & George J. Borjas, 1977. "Middle-Age Job Mobility: Its Determinants and Consequences," NBER Working Papers 0161, National Bureau of Economic Research, Inc.
  4. Douglas Holtz-Eakin, 1993. "Health Insurance Provision and Labor Market Efficiency in the United States," NBER Working Papers 4388, National Bureau of Economic Research, Inc.
  5. Jonathan Gruber & Brigitte Madrian, 1993. "Health Insurance and Early Retirement: Evidence from the Availability of Continuation Coverage," NBER Working Papers 4594, National Bureau of Economic Research, Inc.
  6. Olivia S. Mitchell, 1982. "Fringe Benefits and Labor Mobility," Journal of Human Resources, University of Wisconsin Press, vol. 17(2), pages 286-298.
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