The effect of parent job loss on
health insurance coverage of
children
Susan Busch
Partha Deb
William Gallo
Yale University
Background
• The U.S. economy lost 2.6 million jobs in
2008, with at least another 1.5 million in
2009
• Most displaced workers spend some time
unemployed
– reduced income
– severance of non-pecuniary benefits
(e.g., health insurance)
• Adults often lose health insurance
coverage as a result of job loss (Gruber,
1997 etc.)
Background: children’s coverage
• Little information on the effects of parent job loss
on children’s coverage
• Children may:
– Lose employer sponsored insurance (ESI)
– Lose coverage through private individual market (if
premiums become unaffordable)
– Gain ESI coverage through spouse
– Enroll in public insurance programs, which are now
available at higher income levels
• Job loss is a trigger event for changes in
children’s health insurance coverage (Czajka
and Olsen, 2000)
– Does not distinguish voluntary from involuntary job
changes
Objective
• To examine changes in the insurance
status of children whose parents
experience involuntary job loss
• We examine both:
– For those children insured at time of job loss,
may lose coverage
– For those children uninsured at time of job
loss, may fail to gain coverage
Data:
Medical Expenditure Panel Survey
•
•
•
•
•
Nationally representative household survey
2.5 year panel survey (5 waves)
Approximately 18,000 individuals each cohort
We consider two panels (2004-2006)
Includes monthly information on insurance
coverage
• The subsample we consider are children less
than 19 years of age with at least one employed
parent at baseline
Study Design
• Exploit the longitudinal nature of the MEPS, and
examine changes in insurance status for children post
parent job loss
• Our outcomes of interest are coverage 6 and 12 months
post job loss
• Transitions in and out of coverage may occur in the
absence of job loss
• Children with parents employed at baseline with no job
loss are used as a comparison group
– We randomly assign a ‘job loss’ date to children in comparison
group
• Adjust for weighting and complex sampling structure of
MEPS
• Use logistic regression to predict insurance coverage
Measures
• Involuntary Job loss. Self-report of loss of main job due
to plant closing, business sale or layoff (measured at
each wave)
– Parent must be employed at baseline (wave 1)
– We consider job losses between waves 1 and 3 to ensure
sufficient follow-up
– Precise date of job loss known
– In some analyses we consider only individuals who lost their job
due to plant closing or business sale (reduces concerns about
selection)
• Insurance status. Private, public and uninsured
• Control variables. Job tenure (# years), age, self
reported health status; cohort/panel; single parent; five
income categories
Any insurance coverage (adjusted),
all children (N=7241)
Baseline Month Month
6
12
(%)
(%)
(%)
Children experiencing parent
job loss
Children not experiencing
parent job loss
90
81
84
89
89***
88*
Any Insurance coverage (adjusted),
children insured at baseline
Baseline
(%)
Month
6
(%)
Month
12
(%)
Job loss
100
87.9
88.8
No job loss
100
97.0***
94.9***
Job loss
100
88.7
86.7
No job loss
100
98.1***
96.8***
Job loss
100
87.3
90.8
No job loss
100
94.4*
90.7
Children Insured at Baseline
Privately insured at baseline
Publicly insured at baseline
Any Insurance,
Children Uninsured at Baseline
(%)
Month
6
(%)
Month
12
(%)
Job loss
0
29.6
39.7
No job loss
0
24.0
35.3
Baseline
Children Uninsured at
Baseline
Results
• Among children who were insured in the month
of job loss, significantly fewer are insured six
months later (88 versus 97 %)
• We find no significant change in public coverage
rates in either group at 12 months; entire decline
is for private insurance
• Among children who were not insured in the
month of job loss, children in job loss group may
be more likely to gain coverage
• Robust to limiting to just business sold or plant
closings
Limitations
• We have a relatively small sample of job
losers, so it is difficult to do sub-analyses
• Would like to follow children for longer
than 12 months
• Differences in labor market may affect
estimate (especially to the extent it takes
longer to regain employment)
• Do not know the effects this uninsurance
has on children or their families
Discussion
• COBRA health benefit provisions and the nongroup market are unaffordable to many families.
• Administrative mechanisms related to
unemployment insurance may be used to extend
coverage to job losers
– The efficiency of extending coverage through an
existing infrastructure may make the idea more
attractive to policymakers
• Because the risk of job loss is greatest during
economic downturns there is presently a window
of opportunity to increase public support for
legislation that includes this population as part of
a broader reform proposal
Conclusion/Future Work
• By adding additional MEPS cohorts, we
hope to examine the specific types of
coverage lost/gained
• Additional analyses will examine whether
these effects result in declines in health
status and the receipt of necessary care
Rates of private and public
coverage (adjusted)
Baseline
(%)
Month
6
(%)
Month
12
(%)
61
58
45
58***
47
57***
25
26
23
25
25
25
Privately insured
Job loss
No job loss
Publicly insured
Job loss
No job loss