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Crowd-Out Ten Years Later: Have Recent Public Insurance Expansions Crowded Out Private Health Insurance?

Jonathan Gruber () and Kosali Simon ()

No 12858, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The continued interest in public insurance expansions as a means of covering the uninsured highlights the importance of estimates of "crowd-out", or the extent to which such expansions reduce private insurance coverage. Ten years ago, Cutler and Gruber (1996) suggested that such crowd-out might be quite large, but much subsequent research has questioned this conclusion. We revisit this issue by using improved data and incorporating the research approaches that have led to varying estimates. We focus in particular on the public insurance expansions of the 1996-2002 period. Our results clearly show that crowd-out is significant; the central tendency in our results is a crowd-out rate of about 60%. This finding emerges most strongly when we consider family-level measures of public insurance eligibility. We also find that recent anti-crowd-out provisions in public expansions may have had the opposite effect, lowering take-up by the uninsured faster than they lower crowd-out of private insurance.

JEL-codes: H3 I1 (search for similar items in EconPapers)
Date: 2007-01
New Economics Papers: this item is included in nep-hea and nep-ias
Note: HE PE HC
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Published as Gruber, J., and K. Simon. "Crowd-Out Ten Years Later: Have Recent Public Insurance Expansions Crowded Out Private Health Insurance?" Journal of Health Economics 27, 2 (2008): 201– 217.

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