Public Healthcare Access and the Labor Supply of Farmers

• In Event: Revisiting Medicaid Expansion and Work: Labor Supply, Coverage, and Economic Adjustment Across Populations

Abstract

Farm households frequently obtain health insurance through off-farm employment, raising the possibility that expanding public insurance options could reduce off-farm work and increase labor allocated to the farm. We provide the first causal evidence on this question, exploiting the 2015 Affordable Care Act Medicaid expansion as a natural experiment. Using nationally representative data from the American Community Survey and Agricultural Resource Management Survey, we leverage cross-state variation in Medicaid expansion and estimate dynamic difference-in-differences models of health insurance coverage and farm household labor allocation. We find that Medicaid expansion modestly increased Medicaid enrollment among low-income farm households, with effects growing in the years following implementation. However, we find no corresponding changes in overall health insurance coverage, off-farm employment, off-farm income, or on-farm labor supply. These null results are robust across alternative samples and consistent with descriptive evidence showing that farm households rarely cite health insurance as their sole motivation for off-farm work. The results suggest that although expanding public insurance can change the source of health insurance coverage, off-farm employment serves broader economic functions, including income diversification, earning stability, and retirement benefits, that limit farm households’ labor supply response to expanded public insurance.

Author

• Laura Montenovo, Purdue University
  Presenting Author