Time for mental health care: Evidence from paid sick leave mandates

• In Event: Welfare Effects of Health Policies through Coverage, Financing and Access to Medical Care

Abstract

Consuming health care requires financial resources and time, and policies that reduce the cost of time associated with using health care may increase health care use. A large literature investigates the direct financial price-elasticity of health care demand, but the relationship between time and health care demand has received less attention. We examine the impact of recent state paid sick leave mandates on mental health care use. While the U.S. – unlike the majority of developed countries – lacks a federal paid sick leave policy, 17 states and the District of Columbia have adopted policies which confer approximately seven days per year of financially protected time to eligible employees that can be used for own health needs and to support health needs of dependents. Mental health care is an interesting setting in which to study the importance of time as this care is often viewed as more discretionary than treatment for physical health conditions. Further, the substantial under-diagnoses of mental health disorders and stigma associated with these conditions may affect demand for care. Further, while there are general health care provider shortages in the U.S., these constraints are particularly acute within the mental health care delivery system.

To study the impact of state paid sick leave mandates on mental health care utilization, we combine all-payer claims data from IQVIA over the period 2015 to 2022 with difference-in-differences and event-study methods that are robust to bias associated with a staggered treatment rollout. We estimate the impact of paid sick leave mandates on overall care, dispensed medications, inpatient services, and outpatient services. We explore heterogeneity in paid sick leave mandate effects across payer (private coverage, Medicare, Medicaid, and uninsured) and patient demographics (age and sex).

Our preliminary findings suggest that there is a small but imprecise effect of any mental health treatment after the adoption of a state paid sick leave mandate. However, we find that this overall effect masks a statistically significant decline in dispensed mental health medications and statistically significant increases in both outpatient and inpatient mental health use following adoption of a state paid sick leave mandate. Our analyses suggest that consumers are more likely to substitute for outpatient mental health therapy for prescription drug treatment after a paid sick leave mandate.

We make several contributions with our work. First, our findings shed new light on an important, input necessary for mental health care treatment – time. Second, we explore the extent to which prescriptions and outpatient services are complements or substitutes for mental health care patients. Finally, we contribute to the literature that explores the impacts of paid sick leave policies on American society.

Author

• Ezra Golberstein, University of Minnesota
  Presenting Author