Job Lock and Obamacare.
Posted: Fri Apr 04, 2014 1:42 pm
Another huge benefit of Obamacare was alluded to in a cartoon posted in the hilariously mis-named "1.8m short" thread. That of "Job Lock", people who either cannot leave a job because their or a family members ill-health mean they cannot get health care or will not quit out of fear of being uncovered. There is significant evidence that this phenomenon is important but the exact scale is not yet known. In any case the now-obvious success of Obamacare means they actually have choices now:
http://theincidentaleconomist.com/wordp ... roduction/
http://theincidentaleconomist.com/wordp ... onclusion/
Having a population who are less slaves and more free is surely a good thing.
yrs,
rubato
http://theincidentaleconomist.com/wordp ... roduction/
http://theincidentaleconomist.com/wordp ... onclusion/
see link for the rest.Job lock: Conclusion
April 2, 2014 at 6:00 am
Austin Frakt
Links to all posts in the series to which this post belongs are in the introductory post.
From this series’ review of the job lock literature and Nicholas Bagley’s review of the relevant legal landscape, as well as how the ACA changes it, I draw the following conclusions:
There’s strong theoretical reason to expect some job lock, but the theory can’t tell us how big an effect it has on the labor market.
Job lock exists because of the legal and regulatory structure we’ve chosen to impose on the health insurance and labor markets.
With near unanimity, the empirical literature has found evidence that employer-sponsored health insurance reduces the likelihood of retirement. This is consistent with one form of job lock. However, it is worth keeping in mind that people also don’t retire because health benefits, like wages, are a form of compensation. The job lock effect and the compensation effect are different, though potentially confounded in some studies.
There is also strong evidence that employer-sponsored health insurance increases the labor force participation of prime-aged workers, while spousal coverage reduces it. Moreover, sicker individuals are more likely to work more at jobs that provide their source of coverage. Such results are consistent with job lock.
Studies are more mixed on the effect of employer-sponsored health insurance on job mobility (as distinct from labor force participation), but the balance of results in the literature are consistent with this form of job lock.
Entrepreneurship lock—that individuals are less likely to elect to become self-employed because of the greater value of employer-sponsored health insurance relative to what they can access on the individual market—is another variant of job lock identified in the literature. Here too, the vast majority of studies find evidence consistent with it.
In several ways the ACA will mitigate job and entrepreneurship lock.
Finally, here’s a bonus bit of survey evidence from the Urban Institute:
Having a population who are less slaves and more free is surely a good thing.
yrs,
rubato