Same-Sex Marriage and Employer Choices about Domestic Partner Benefits

We provide the first evidence on employer health insurance decisions regarding same-sex domestic partner (SSDP) benefits before and after nationwide legal same-sex marriage (SSM) was adopted in the United States by Obergefell v. Hodges, 576 U.S. 644 (2015). Using rich microdata on over 250,000 establishments from the 2013–19 Medical Expenditure Panel Survey–Insurance Component (MEPS-IC), we show that private employers were 7 percentage points more likely to offer SSDP benefits than different-sex domestic partner (DSDP) benefits prior to 2015. After Obergefell, however, the likelihood of SSDP benefits among these employers fell significantly, back to the DSDP benefit offer rate. Novel linkages between MEPS-IC establishments and Internal Revenue Service data allow us to show that these reductions were driven by establishments whose parent firms were more exposed to legal SSM prior to Obergefell owing to the geographic distribution of their workforce. Our results suggest the importance of within-firm pay equity norms as a reason for SSDP benefits prior to nationwide SSM and provide the first direct evidence that legal access to SSM was associated with significantly reduced SSDP benefit offer rates.