Marcus Dillender

Do more health insurance options lead to higher wages? Evidence from states extending dependent coverage

Little is known about how health insurance affects labor market decisions for young adults. This is despite the fact that expanding coverage for people in their early 20s is an important component of the Affordable Care Act. This paper studies how having an outside source of health insurance affects wages by using variation in health insurance access that comes from states extending dependent coverage to young adults. Using American Community Survey and Census data, I find evidence that extending health insurance to young adults raises their wages. The increases in wages can be explained by increases in human capital and the increased flexibility in the labor market that comes from people no longer having to rely on their own employers for health insurance. The estimates from this paper suggest the Affordable Care Act will lead to wage increases for young adults.

The death of marriage? The effects of new forms of legal recognition on marriage rates in the United States.

Some conservative groups argue that allowing same-sex couples to marry reduces the value of marriage to opposite-sex couples. This article examines how changes in U.S. legal recognition laws occurring between 1995 and 2010 designed to include same-sex couples have altered marriage rates in the United States. Using a difference-in-differences strategy that compares how marriage rates change after legal recognition in U.S. states that alter legal recognition versus states that do not, I find no evidence that allowing same-sex couples to marry reduces the opposite-sex marriage rate. Although the opposite-sex marriage rate is unaffected by same-sex couples marrying, it decreases when domestic partnerships are available to opposite-sex couples.

Social Security and Divorce Decisions

People who have divorced are entitled to Social Security spousal benefits if their marriages lasted at least ten years. This paper uses 1985-1995 Vital Statistics data and the 2008-2011 American Community Surveys to analyze how this rule affects divorce decisions. I find evidence that the ten-year rule results in a small increase in divorces for the general population; however, the effects vary greatly by age. Divorce decisions change very little for people under the age of 35. For people 55 and older, however, divorces increase by approximately 20 percent around the ten-year cutoff, which leads to an increase in the likelihood of being divorced of 11.7 percent at ten years of marriage. For people between the ages of 35 and 55, who account for over half of divorces, the likelihood of being divorced increases by almost 6 percent as marriages cross the ten-year mark. This heterogeneity across ages likely exists because older people are more focused on retirement and have less time to remarry. These results indicate many people delay divorcing because they need Social Security benefits.

Medicaid, Family Spending, and the Financial Implications of Crowd-Out

A primary purpose of health insurance is to protect families from medical expenditure risk. Despite this goal and despite the fact that research has found that Medicaid can crowd out private coverage, little is known about the effect of Medicaid on families’ spending patterns. This paper implements a simulated instrumental variables strategy with data from the Consumer Expenditure Survey to estimate the effect of an additional family member becoming eligible for Medicaid on family-level health insurance coverage and spending. The results indicate that an additional family member becoming eligible for Medicaid increases the number of people in the family with Medicaid coverage by about 0.135 to 0.142 and decreases the likelihood that a family has any medical spending in a quarter by 2.7 percentage points. As previous research often finds with different data sets, I find evidence that Medicaid expansions crowd out some private coverage. Unlike most other data sets, the Consumer Expenditure Survey allows for considering the financial implications of crowd-out. The results indicate that families that transition from private coverage to Medicaid are able to spend significantly less on health insurance expenses, meaning Medicaid expansions can be welfare improving for families even when crowd-out occurs.