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Family Health Benefits and Worker Turnover

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  • Dan A. Black

    (University of Kentucky)

Abstract

In this paper, I examine the impact of employer-provided health benefits on job turnover. Because many employer-provided plans extend coverage to a worker's entire family, the value of an employer's employment offer to a worker depends on whether the worker's spouse provides the family with health benefits. If a worker's spouse has an employer-provided health insurance for their family, the worker will value employment offers with and without health insurance benefits differently than a worker whose spouse does not have employer-provided health benefits. Importantly, this distortion arises from the reliance on employer-provided benefits and is independent of any pre-existing conditions clauses or issues concerning the portability of health plans. The estimates suggest that spouse-provided benefits substantially increase the likelihood of turnover.

Suggested Citation

  • Dan A. Black, 1996. "Family Health Benefits and Worker Turnover," Labor and Demography 9604001, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpla:9604001
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    References listed on IDEAS

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    1. Frank A. Scott & Mark C. Berger & Dan A. Black, 1989. "Effects of the Tax Treatment of Fringe Benefits on Labor Market Segmentation," ILR Review, Cornell University, ILR School, vol. 42(2), pages 216-229, January.
    2. Woodbury, Stephen A, 1983. "Substitution between Wage and Nonwage Benefits," American Economic Review, American Economic Association, vol. 73(1), pages 166-182, March.
    3. Jonathan Gruber & Brigitte C. Madrian, 1993. "Limited Insurance Portability and Job Mobility: The Effects of Public Policy on Job-Lock," NBER Working Papers 4479, National Bureau of Economic Research, Inc.
    4. Diamond, Peter, 1992. "Organizing the Health Insurance Market," Econometrica, Econometric Society, vol. 60(6), pages 1233-1254, November.
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    7. Douglas Holtz-Eakin, 1994. "Health Insurance Provision and Labor Market Efficiency in the United States and Germany," NBER Chapters, in: Social Protection versus Economic Flexibility: Is There a Trade-Off?, pages 157-188, National Bureau of Economic Research, Inc.
    8. Farber, Henry S, 1994. "The Analysis of Interfirm Worker Mobility," Journal of Labor Economics, University of Chicago Press, vol. 12(4), pages 554-593, October.
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    10. Rebecca A. Luzadis & Olivia S. Mitchell, 1991. "Explaining Pension Dynamics," Journal of Human Resources, University of Wisconsin Press, vol. 26(4), pages 679-703.
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    12. Ippolito, Richard A, 1985. "The Labor Contract and True Economic Pension Liabilities," American Economic Review, American Economic Association, vol. 75(5), pages 1031-1043, December.
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    Cited by:

    1. Anja Decressin & Julia Lane & Kristin McCue & Martha Stinson, 2005. "Employer-Provided Benefit Plans, Workforce Composition and Firm Outcomes," Longitudinal Employer-Household Dynamics Technical Papers 2005-01, Center for Economic Studies, U.S. Census Bureau.

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    More about this item

    Keywords

    turnover; health insurance; fringe benefits;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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