Academic journal article International Advances in Economic Research

A Further Analysis of Determinants of Health Insurance Coverage

Academic journal article International Advances in Economic Research

A Further Analysis of Determinants of Health Insurance Coverage

Article excerpt

Abstract

This study uses state-level data to identify key factors influencing geographic differentials in the percentage of the population without health insurance coverage, with particular emphasis placed on the impact of the percentage of the population that is either self-employed or independent contractors. Not surprisingly, the cross-section analysis finds that the percentage of a state's population without health insurance was a decreasing function of median family income in the state, the female labor force participation rate in the state, and the percentage of the state's population age 65 and older, while being an increasing function of the percentage of households in the state with only a female head of household present (no husband present) and the percent of the state's population classified as Hispanic. Reflecting the emphasis in this study, the empirical estimates all also reveal that the percentage of a state's population without health insurance is an increasing the percentage of the state's population that filed a federal personal income tax return that included a Schedule C, which is used in this study as a proxy for self-employment and independent contractors. (JEL I11)

Introduction

Various dimensions of the healthcare industry have attracted considerable attention, especially since the early 1990s. This attention covers a broad spectrum of topics, ranging from hospital costs, profitability, and efficiency issues to medical malpractice to physician staffing to healthcare inflation to markets for health insurance coverage [Bopp, 2005; Burstin, 1998-1999; Chirikos, 1998-1999; Cutler, 1994; Daniels and Gatsonis, 1999; Dushi and Honig, 2003; Gaynor and Haas-Wilson, 1999; Given, 1996; Glied, 2003; Goodman and Stano, 2000; Gruber, 2003; Harris and Keane, 1999; Hart et al., 1997; Holahan et al., 2003; Karsten, 1995; Jordan, 2001; Koch and Cebula, 1992; Marstellar et al., 1998; Newhouse, 1994; Okunade, 2001, 2003; Olsen, 1996; Swartz, 2001, 2003].

Of these issues, that of health insurance coverage has increasingly captured the interest not only of the popular press and political pundits but also of scholars across a variety of academic disciplines. Presumably, as argued in Dushi and Honig [2003, p. 252], at least part of this increased attention from researchers can be attributed to the fact that the "... decline in health insurance coverage over the last two decades is a matter of national concern." Indeed, over a decade ago, Cutler [1994, p. 20] had observed that "About 15 percent of the population ... are uninsured." And much more recently, Swartz [2003, p. 283] has observed that "At least 41 million Americans are currently without health insurance in any given month ..."

This study seeks to provide insights into this issue by identifying key factors that determine geographic differentials in the percentage of the population without health insurance coverage. In particular, after developing a rudimentary framework of the demand for health insurance, this study empirically investigates, using state-level data for all 50 states, the impact of such factors as the following: The female labor force participation rate; the percentage of the population that is unionized; the percentage of family units with a female head of household (i.e., no husband present); median family income; the percentage of the population age 65 and above; and the percentage of the population identified as Hispanic. Although these factors have largely been examined in some fashion or other in previous studies, the present study also expressly endeavors to formally determine empirically the impact on enrollment in health insurance of the percentage of the population that is at least partly self-employed or independent contractors.

The Framework

The framework adopted in this study most closely follows the analyses found in [Dushi and Honig, 2003], [Newhouse, 1994], and [Swartz, 2003]. …

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