The Effects of the Dependent Coverage Mandates on Fathers’ Job Mobility and Compensation∗

Motivated by low rates of health coverage among young adults, some state governments began mandating health insurers to allow adult children to stay on their parents’ insurance plans. First implemented in 1995, these mandates aimed to increase health coverage among young adults and reduce their dependence on employment for health insurance. In 2010, the federal government enacted a more comprehensive version of the dependent coverage mandate as part of the Affordable Care Act. These state and federal-level efforts successfully increased insurance rates for young adults, but they may have come with unintended implications for their parents. Parents who place a high value on health insurance for their young adult children may be reluctant to leave jobs with employer-provided health insurance. In addition, employers may offset the increased health care costs by reducing other types of employee benefits or earnings. To assess the extent of these impacts, I study the effects of both the state and federal dependent health insurance mandates on fathers. By analyzing the 2004 and 2008 SIPP panels, which are linked with Detailed Earnings Records and Business Registrar data from the U.S. Census, I examine the mandates’ effects on voluntary job separation rates (as job-lock and job-push) and changes in fathers’ compensations. After the implementation of the mandates, a 37 percent decrease in the likelihood of voluntary job separation among eligible working fathers aged 45–64 with health insurance is observed. I do not observe any significant effect associated with job-push. Additionally, the implementation of the mandates appeared to decrease annual earnings and total monetary compensation among eligible working fathers.