Essays in health and labor economics

This thesis focuses on how health care policies affect the labor supply of physicians and beneficiaries. Further, I examine how the labor supply responses of physicians vary based on the level of competition.

In the first chapter, I focus on how physicians change their working hours after two large public health insurance expansions; the State Children’s Health Insurance Program (SCHIP) and the Affordable Care Act (ACA). These insurance programs have significantly increased the number of patients with public health insurance and the demand for medical services, but it is not clear whether providers will supply additional medical services for newly-insured patients. In response to the introduction of SCHIP, I found that physicians reallocate their total working hours between patient care and non-patient care activities. Physicians spend less hours with their patients and more hours on other activities that can increase their Competitiveness. The size of the impact was greater in competitive areas prior to the expansion. Physicians in high competition areas tend to spend fewer with their patient, but increase hours on non-patient care hours. In response to the ACA, physicians’ working hours did not increase, but working hours and the probability of being employed increased for registered nurses. This suggests that physicians might utilize other healthcare providers to accommodate increases in demand for medical services after the expansion.

In the second chapter, we analyzed the impact of expanding Medicaid on health insurance coverage and labor market outcomes. In the United States, employer-sponsored insurance (ESI) is the primary mechanism (55%) to obtain health insurance. Therefore, expansions of public health insurance have the potential to reduce the uninsured rate, but also to reduce coverage through ESI because individuals have the opportunity to enroll in public health insurance program. Now individuals do not need to stick to a particular company, because he or she do not need to worry about health care benefits. Thus, expansions will reduce labor supply, and increase job mobility. In January 2014, twenty-five states expanded Medicaid as part of the Affordable Care Act to low-income parents and childless adults. We compare the changes in insurance coverage and labor market outcomes over time of adults in states that expanded Medicaid and in states that did not. Our estimates suggest that individuals are more likely to have Medicaid coverage and less likely to drop ESI after the recent expansion. Overall, the expansion did not impact labor market outcomes, including labor force participation, employment, and hours worked.

In the third chapter, I examined the impact of competition among dentists on the labor supply of dentists. I focus on how dentists’ working hours will change if competition among dentists increases by examining the effect of the National Health Service Corps (NHSC) programs. The NHSC was created to increase the supply of rural physicians by providing financial incentives to medical students and healthcare providers. As the number of dentists increases, the competition among dentists would go up in rural areas. Greater competition leads to better quality of health services, high productivity of providers, and low medical price. However, the increases in competition could change working hours of dentists. In this chapter, I examine the number of dentists (extensive margins of labor supply) and the change in the working hours of dentists (intensive margins of labor supply) in response to the increased level of physician competition. I found that 1 percent increase in NHSC-approved sites increases 5.4% increases in the number of providers and 0.2% of competition in a rural county. In addition, I found that there is a positive relationship between the number of NHSC-approved sites and providers’ working hours. If there is an additional dentist per 1,000 population, then dentists work about 6 hours more per week.