Session: The Effects of Women’s Health Insurance Mandates
Room: Phillips 219
Time: Tue 08:30-10:00

Presenter: Joanna Lahey (Texas A&M University. )

Discussant: Joseph Price (Brigham Young University)

Abstract

Recent research has found mixed results of the effects of health insurance mandates on outcomes such as labor supply, wages, and even insurance premium costs. This paper considers the labor market effects of mandates that raise the cost of employing a demographically identifiable group. Whether or not these policies are efficient largely depends on the extent to which their costs are shifted to group-specific wages rather than to total labor input for that group. I study several state and federal mandates which stipulate that infertility treatment be covered in health insurance plans, thus raising the relative cost of insuring older women of child- bearing age. Unlike Gruber’s findings for mandated maternity benefits, I find small or non- existent effects on shifting of wages to this group, but a substantial effect on total labor input for that group. I argue that the differences in the effects of mandates found in the literature can be explained by basic economic theory; elasticity of demand, moral hazard, ability to identify a group, and adverse selection. Workers do not value infertility mandates at cost, and are not willing to take wage cuts to completely offset these costs, leading to employers to decrease their labor supply.

Key Terms

Infertility, state mandates, health insurance, labor supply

Authors:

Joanna Lahey (Texas A&M University)