The Effect of Public Insurance Coverage for Childless Adults on Labor Supply*

This study provides plausibly causal estimates of the effect of public insurance coverage on the employment of non-elderly, non-disabled adults without dependent children (“childless adults”). We use both a regression discontinuity design and propensity score matching differences in differences to take advantage of the sudden imposition of an enrollment cap to compare the labor supply of enrollees to eligible applicants placed on a waitlist. We find enrollment into public insurance leads to sizable and statistically meaningful reductions in employment up to at least 9 quarters later, though the estimated size of this reduction varies from 2 to 10 percentage points depending upon the model used. In light of these results, policymakers should be prepared for a reduction in labor supply among childless adults affected by the Medicaid expansion under the Affordable Care Act