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Spillover effects of increased health insurance enrollment on workers’ compensation insurance
Author(s) -
Baggett Courtney B.,
Cole Cassandra R.,
Crowley George,
Sirmans E. Tice
Publication year - 2020
Publication title -
risk management and insurance review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.386
H-Index - 16
eISSN - 1540-6296
pISSN - 1098-1616
DOI - 10.1111/rmir.12142
Subject(s) - spillover effect , business , health insurance , actuarial science , group insurance , profitability index , workers' compensation , casualty insurance , insurance policy , compensation (psychology) , general insurance , health care , finance , income protection insurance , economics , economic growth , psychology , psychoanalysis , microeconomics
The Patient Protection and Affordable Care Act (ACA) was designed to increase the accessibility and affordability of health insurance. While the ACA did not contain direct provisions related to workers’ compensation (WC), because health‐related coverage is a significant portion of WC costs, the ACA could have unintentionally impacted the WC market. Specifically, expanded health insurance enrollment could reduce WC losses and result in higher performance among insurers participating in the WC market. Using insurer‐state level data, we consider the impact of increased health insurance enrollment on the performance of property‐casualty (PC) insurers. Utilizing multiple measures of performance, we find that the post‐ACA period is generally associated with greater profitability for PC insurers operating in the WC market, a positive unintended consequence of this federal regulation.