Workers on the Margin: Who Drops Health Coverage When Prices Rise?
We revisit the question of price elasticity of employer-sponsored insurance (ESI) take-up by directly examining changes in the take-up of ESI at a large firm in response to exogenous changes in employee premium contributions. We find that, on average, a 10% increase in the employee's out-of-poc...
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| Main Authors: | , , |
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| Format: | Book |
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SAGE Publishing,
2010-02-01T00:00:00Z.
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| Online Access: | Connect to this object online. |
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| Summary: | We revisit the question of price elasticity of employer-sponsored insurance (ESI) take-up by directly examining changes in the take-up of ESI at a large firm in response to exogenous changes in employee premium contributions. We find that, on average, a 10% increase in the employee's out-of-pocket premium increases the probability of dropping coverage by approximately 1%. More importantly, we find heterogeneous impacts: married workers are much more price-sensitive than single employees, and lower-paid workers are disproportionately more likely to drop coverage than higher-paid workers. Elasticity estimates for employees below the 25 th percentile of salary distribution in our sample are nearly twice the average. |
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| Item Description: | 0046-9580 10.5034/inquiryjrnl_47.01.33 |