Does health care reform support self-employment?

Thealexa Becker and Didem Tuzemen

Economic Review, 2014, issue Q III, 5-23

Abstract: Health insurance access can influence individuals' labor market decisions. Some economists argue employer-provided health insurance may have deterred entrepreneurship, as self-employed individuals may have faced difficulties in obtaining coverage. As the Patient Protection and Affordable Care Act (PPACA) is gradually implemented, the reform might affect individuals' decisions to become or remain self-employed. Tzemen and Becker examine a similar reform, the Massachusetts Health Care Reform Act, as a case study for the PPACA. They find the uninsured rate declined in Massachusetts following the reform for working-age individuals in general and for the self-employed in particular. Additionally, the self-employment share stayed flat in the state while declining in the rest of the nation. The authors conclude the reform may have supported self-employment in Massachusetts, and suggest the PPACA might have similar effects on the national self-employment share.

Date: 2014
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