Does COBRA reduce the probability that job separators return to work?

David Zimmer

Journal of Economic Policy Reform, 2015, vol. 18, issue 4, 326-340

Abstract: This study examines a decade of individual-level US employment and insurance information to investigate whether federally mandated Consolidated Omnibus Reconciliation Act (COBRA) regulation affects post-separation employment activity. The empirical approach addresses the possibility that COBRA enrollment is endogenous with respect to post-separation employment outcomes. The main finding is that, although COBRA enrollees are 5 percentage points less likely to become re-employed, this relationship is not causal. Rather, individuals with lower probabilities of becoming re-employed tend to enroll in COBRA. The reason appears to be because, when compared to subjects who voluntarily leave for other jobs, subjects who separate for other reasons not only are less likely to become re-employed, but they also are approximately 23% more likely to enroll in COBRA.

Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:taf:jecprf:v:18:y:2015:i:4:p:326-340

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DOI: 10.1080/17487870.2015.1019290

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