Academic journal article International Journal of Management

Effects of Health Insurance and Medical Care Inflation on Voluntary Enlistment in the Army: An Empirical Study in the United States

Academic journal article International Journal of Management

Effects of Health Insurance and Medical Care Inflation on Voluntary Enlistment in the Army: An Empirical Study in the United States

Article excerpt

Voluntary enlistment in the military is motivated by a variety of factors, including economic forces such as employment opportunities, income prospects, and employer-provided benefits such as health insurance. This study investigates two research questions that to date have been neglected, namely: (1) does a higher percentage of the civilian population without health insurance act as an incentive for more civilians to voluntarily enlist in the U.S. Army?; and (2) does a higher level of medical care inflation act as an incentive for more civilians to voluntarily enlist in the U.S. Army? Within a cost-benefit framework, the empirical analysis uses annual data for the years 1974 through 2008, the only years to date for which all of the variables in the model are dependable after the end of military conscription in the U.S. in 1973. The empirical estimates support the propositions that the greater the percentage of the civilian population without health insurance, the greater the rate of voluntary enlistment in the U.S. Army and that the greater the medical care inflation rate, the greater the rate of voluntary enlistment in the U.S. Army.

(ProQuest: ... denotes formulae omitted.)

I. Introduction

Myriad dimensions of the health care and health insurance industries have attracted the attention of researchers. The issues investigated by these researchers range from those of pharmaceutical expenditures, hospital profitability, and hospital efficiency to those of moral hazard and health insurance, the effectiveness of preventive health care measures, mental health expenditures, medical malpractice, nurse training and staffing, physician staffing, and causes of health care inflation (Chirikos, 1998-99; Daniels and Gatsonis, 1999; Given, 1996; Glied, 2003; Goodman and Stano, 2000; Hart et al, 1997; Jordan, 2001; Karsten, 1995; Koch and Cebula, 1992; Laundsen, et al, 2010; Moscone and Knapp, 2005; Okunade, 2001, 2003; Olsen, 1996). One of the most important and contentious issues in this research, the one receiving the greatest increase in attention in recent years is health insurance coverage or the lack thereof (Bharmal and Thomas, 2005; Bundorf andPauly, 2002; Cebula, 2006; Dushi andHomg, 2003; Fnck andBopp, 2005; Gruber, 2003; Harris and Keane, 1999; Holahan et al, 2003; Kronick and Gilmer, 2002; Marstellar et al, 1998; Newhouse, 1994; Nyman, 2003; Swartz, 2001; 2003).

This intensive and extensive research can be attributed to several issues. Presumably, as argued in Dushi and Honig (2003, p. 252), at least part of this increased research attention can be attributed to the fact that there has been a noticeable decline in health insurance coverage in the U.S., especially over the last two decades. Indeed, over 1 5 years ago, Cutler (1994, p. 20) had observed that "About 15 percent of the population... are uninsured." More recently, for the year 2003, Bharmal and Thomas (2005, p. 643)

observe that the number of uninsured reached 43.6 million or 17.3 percent of persons under the age of 65. Amidst the national debate in recent years over health care reform in the U.S., claims of the extent of the uninsured have run as high as 47 million (Cebula, Nair-Reichert, and Taylor, 2010).

The present study endeavors to provide insights into two very different dimensions of the overall health insurance/healthcare issue. In particular, this study first hypothesizes that the greater the percentage of the civilian population that is without health insurance, the greater the incentive at the margin for civilians to enlist in the U.S. Army, ceteris paribus, paralleling in principle the rather different specifications found in Cebula, Nair-Reichert, and Taylor (2010). Next, this study hypothesizes that the greater the medical care inflation rate, the greater the incentive at the margin for civilians to enlist in the U.S. Army, ceteris paribus, thusly addressing a key issue overlooked in Cebula, Nair-Reichert, and Taylor (2010). …

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