Health Insurance and Young Adults: An Analysis Using the NLSY

Article excerpt

JEL 118

One group which is typically discussed in regards to its lack of health insurance is the young adult segment of the population. For the age group 18-26, 32% lack health insurance (Holahan and Kenney, Timely Analysis of Immediate Health Policy Issue, 2008). For the entire non-elderly population, the uninsured rate is closer to 18%. In addition, although this age group constitutes only 18% of the adult population, it makes up over 28% of the uninsured (Holahan and Kenney, Timely Analysis of Immediate Health Policy Issue, 2008). Because of this, the young adult segment of the population is the ideal group to use in an analysis of the determinants of health insurance coverage.

Several studies have been conducted on health insurance coverage (Markowitz, Gold, and Rice, Medical Care, 1991; Newacheck, et al., Pediatrics, 1999; Callahan and Cooper, Pediatrics, 2005; Gruber, Journal of Economic Literature, 2008; Levine, McKnight, and Heep, NBER Working Paper, 2009; and Gius, International Journal of Applied Economics, 2010). Most of these studies used descriptive statistics and correlation analyses to ascertain the extent of the uninsured. Few looked at the determinants of health insurance coverage, and even fewer examined the insurance coverage rates of young adults.

The purpose of the present study is to determine the factors that affect the health insurance coverage of young adults. This study will use as its data set the National Longitudinal Survey of Youth (NLSY), a data set that has not been used in prior studies on health insurance coverage.

In order to estimate the determinants of health insurance coverage, an equation was estimated that has as its dependent variable a binary variable that equals one if a person has health insurance and zero otherwise. The following were used as explanatory variables: MALE which equals one if person is male and zero otherwise;

MARR which equals one if person is married and zero otherwise; DIVORCE which equals one if person is divorced and zero otherwise; NORTH, SOUTH, and WEST are all region of residence dummy variables; BLACK which equals one if person is African-American and zero otherwise; WHITE which equals one if person is white and zero otherwise; AGE is the age of the person; EDUC is the number of years of formal schooling; INCOME is gross household income; HOURS is the number of hours worked per week; URBAN which equals one if the person resides in an urban area; and CHILD is the number of children an individual has. …