The Impact of the Macroeconomy on Health Insurance Coverage: Evidence from the Great Recession

39 Pages Posted: 28 Nov 2011 Last revised: 9 May 2023

See all articles by John Cawley

John Cawley

Cornell University - College of Human Ecology, Department of Policy Analysis & Management (PAM); Cornell University - College of Arts & Sciences, Department of Economics; Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE); University of Galway - J.E. Cairnes School of Business & Economics; NBER; IZA

Asako Moriya

School of Public and Environmental Affairs (SPEA), Indiana University

Kosali Ilayperuma Simon

Indiana University

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Abstract

This paper investigates the impact of the macroeconomy on the health insurance coverage of Americans using panel data from the Survey of Income and Program Participation (SIPP) for 2004-2010, a period that includes the Great Recession of 2007-09. We find that a one percentage point increase in the state unemployment rate is associated with a 1.67 percentage point (2.12%) reduction in the probability that men have health insurance; this effect is strongest among college-educated, white, and older (50-64 year old) men. We estimate that 9.3 million Americans, the vast majority of whom were adult men, lost health insurance due to a higher unemployment rate alone during the 2007-09 recession. We conclude with a discussion of how components of recent health care reform may influence this relationship in the future.

Keywords: health insurance, recession, unemployment, Medicaid, SCHIP

JEL Classification: I10, J3, J6, E32

Suggested Citation

Cawley, John and Moriya, Asako and Simon, Kosali Ilayperuma, The Impact of the Macroeconomy on Health Insurance Coverage: Evidence from the Great Recession. IZA Discussion Paper No. 6124, Available at SSRN: https://ssrn.com/abstract=1965141 or http://dx.doi.org/10.2139/ssrn.1965141

John Cawley (Contact Author)

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Asako Moriya

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Kosali Ilayperuma Simon

Indiana University ( email )

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