The Effects of the Affordable Care Act Dependent Coverage Mandate on Parents' Labor Market Outcomes

Seonghoon Kim () and Kanghyock Koh ()
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Kanghyock Koh: Korea University

No 14089, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We examine the labor market impacts of the Affordable Care Act dependent mandate (ACA-DM), which has significantly increased dependent children's health insurance coverage through parents' employer-sponsored health benefits. Using data from the American Community Survey, we find that the ACA-DM reduced parents' annual wages by about $2,600. However, the probability of employment and working hours only decreased marginally. The back-of-the-envelope calculation indicates that the magnitude of the estimated wage impact is similar to the increased insurance premium of a family plan due to the ACA-DM. These findings imply that a deadweight loss associated with the expansion of dependent health coverage is likely to be small as an increase in employers' labor costs is offset by a reduction in parents' wages without significant reductions in labor inputs.

Keywords: The Affordable Care Act dependent mandate; dependent health insurance coverage; parents’ labor market outcomes; deadweight loss (search for similar items in EconPapers)
JEL-codes: H51 I18 J32 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2021-02
New Economics Papers: this item is included in nep-ias, nep-lma and nep-sea
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Citations: View citations in EconPapers (2)

Published - published in: Labour Economics, 2022, 75, 102128

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