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The micro-firm health insurance hypothesis

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  • Richard Cebula

Abstract

The objective of this study is to investigate the 'micro-firm health insurance hypothesis', a hypothesis that the greater the percentage of domestic firms that are 'very small', i.e. have four or fewer employees, the greater the percentage of the US population that will be without health insurance. The focus of this study is based on the premise that very small firms (as defined), 'micro-firms', which constitute 58.6% of all private sector firms in the US, face bargaining-power, financial, and competitive constraints that tend to limit their ability to provide group health insurance benefits to their employees, with the result being that employees at very small firms are relatively more likely than employees at larger firms to be without a health insurance fringe benefit. Weighted Least Squares (WLS) estimates provide strong empirical support for the hypothesis.

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  • Richard Cebula, 2010. "The micro-firm health insurance hypothesis," Applied Economics Letters, Taylor & Francis Journals, vol. 17(11), pages 1067-1072.
    • Handle: RePEc:taf:apeclt:v:17:y:2010:i:11:p:1067-1072
    DOI: 10.1080/00036840902817532
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    References listed on IDEAS

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    1. de Meza, David, 1983. "Health insurance and the demand for medical care," Journal of Health Economics, Elsevier, vol. 2(1), pages 47-54, March.
    2. Richard Cebula, 2006. "A Further Analysis of Determinants of Health Insurance Coverage," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 12(3), pages 382-389, August.
    3. David M. Cutler & Jonathan Gruber, 1996. "Does Public Insurance Crowd out Private Insurance?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(2), pages 391-430.
    4. Norman Thurston, 1999. "On the decline of employment-based health insurance in the US," Applied Economics Letters, Taylor & Francis Journals, vol. 6(10), pages 683-686.
    5. repec:kap:iaecre:v:12:y:2006:i:3:p:382-389 is not listed on IDEAS
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    Cited by:

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    2. Alexander, Gigi M. & Cebula, Richard J., 2011. "Non-Economic and Economic Factors in the Decision to Obtain a Pap Smear: The Case of Women Residents in the State of Florida," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 41(2), pages 1-7.

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