Mandate-based health reform and the labor market: Evidence from the Massachusetts reform

Jonathan Kolstad and Amanda Kowalski

Journal of Health Economics, 2016, vol. 47, issue C, 81-106

Abstract: We model the labor market impact of the key provisions of the national and Massachusetts “mandate-based” health reforms: individual mandates, employer mandates, and subsidies. We characterize the compensating differential for employer-sponsored health insurance (ESHI) and the welfare impact of reform in terms of “sufficient statistics.” We compare welfare under mandate-based reform to welfare in a counterfactual world where individuals do not value ESHI. Relying on the Massachusetts reform, we find that jobs with ESHI pay $2812 less annually, somewhat less than the cost of ESHI to employers. Accordingly, the deadweight loss of mandate-based health reform was approximately 8 percent of its potential size.

Keywords: Affordable Care Act; Massachusetts health reform; Welfare effects; Labor market; Individual mandate (search for similar items in EconPapers)
JEL-codes: H5 I1 J2 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (42)

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Related works:
Working Paper: Mandate-Based Health Reform and the Labor Market: Evidence from the Massachusetts Reform (2014)
Working Paper: Mandate-Based Health Reform and the Labor Market: Evidence from the Massachusetts Reform (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:47:y:2016:i:c:p:81-106

DOI: 10.1016/j.jhealeco.2016.01.010

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