Examining the Relationships Between Employment-Contingent Health Insurance, Treatment Decisions, Health Outcomes, & Labor Supply

Cathy J. Bradley, PhD
Professor, Department of Health Administration
Co-leader, Cancer Prevention and Control Massey Cancer Center
Virginia Commonwealth University
Richmond, VA
cjbradley@vcu.edu

What's the problem?

Employers are the principal source of health insurance in the United States, providing health benefits to about half of non-elderly adults in this country. Some of these adults are covered by insurance through their own employers (this is called "employer-contingent health insurance," or ECHI); others are covered by insurance through their spouse's employer.

The source of a person's health insurance coverage can affect a wide range of labor market decisions, such as where and how much people work and whether they stay with an employer or change jobs. Changes in a person's health status, such as a cancer diagnosis and subsequent treatment and recovery, injects a third and complex dynamic into this health insurance-employment link.

In the past few years, some light has been shed on how these three factors interact and influence each other, but major gaps in our knowledge still exist.

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How does this research address the problem?

Since 1998, Dr. Cathy Bradley, a health economist, has conducted a series of ARP-supported studies to explore the health care and decisions about employment and hours worked that individuals make in response to incentives and disincentives created by a cancer diagnosis and source of health insurance. Findings from each study have informed and enriched subsequent work, allowing for a broad and pioneering exploration of these issues.

Dr. Bradley's first study examined labor market outcomes of long-term breast cancer survivors by comparing samples from the Health and Retirement Survey and NCI's Surveillance, Epidemiology, and End Results (SEER) program. She found that the survivors were less likely to work compared to women who had never had cancer. She also found that, compared to working women without cancer, women who were employed after their diagnosis worked more hours per week and had higher wages and earnings. Her conclusion was that breast cancer's effects on labor supply was complicated in that it had both negative effects (causing some women to stop working) and positive effects (causing women to stay in the workforce or increase their hours in order to retain health insurance or rebuild financial assets).

Dr. Bradley and her colleagues then began to focus on the relationship between ECHI, health, and decisions about work. They first created a model to explain how workers with ECHI may respond to a health shock, such as a cancer diagnosis. The model indicated that a health shock will likely reduce the person's labor supply, but that the effect would be smaller for workers with ECHI than for workers who have insurance through their spouse.

The next step was a five-year ARP-funded study, conducted with Dr. David Neumark, an international expert in labor economics. This study collected and analyzed data over an 18-month period on the labor market decisions of a cohort of women newly diagnosed with breast cancer, men newly diagnosed with prostate cancer, a control group of people without cancer, and spouses. The analysis provided compelling evidence that ECHI creates incentives to remain working following a health shock, such as breast cancer, and that some women with ECHI may forego radiation or chemotherapy treatment to avoid interruptions in their ability to meet work demands. In addition, the study found that women with ECHI are more likely than women with insurance through their spouse to have only poor or fair health after diagnosis and treatment.

These results were the catalyst for another study of married women newly diagnosed with breast cancer. This research, currently underway, uses a quasi-experimental design to compare women with ECHI and women who have health insurance through their spouses on three different issues: (1) cancer treatment and treatment adherence; (2) changes in health status at 2 and 9 months following diagnosis; and (3) labor supply responses at 2 and 9 months following diagnosis compared to the time immediately preceding diagnosis. Dr. Bradley and Dr. Neumark also are examining the labor supply responses of spouses following their partner's breast cancer diagnosis. Conceivably, ECHI creates similar labor supply incentives for employed, healthy spouses of women with breast cancer as it does for women with the disease. Spouses with ECHI may work long hours and thereby forego caregiving activities so that they can preserve their insurance.

Dr. Bradley is now collaborating on a new study that is replicating her previous analyses in a population-based cohort of 750 breast, prostate, and colorectal cancer patients in Ireland. Using data from two telephone surveys, conducted at about 6 and 12 months after diagnosis, Dr. Bradley will investigate rates of work resumption and the personal, treatment, and job-related factors that influence it. She also will examine the cancer survivors' experiences after returning to the workplace and the influence of employers and health care professionals on survivors' decisions about resuming work. The survivors' employment outcomes will be compared with those of the overall Irish population and US cancer survivors.

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Significance of the study & results

Because of the emphasis on screening and early detection of cancer, many individuals must deal with cancer and the consequences of treatment during their working years. For them, work is financially essential, both for the income it provides and because it supplies health insurance. A greater understanding of the interactions among ECHI, job and work decisions, treatment decisions, and health outcomes is vital to a host of health policy issues, given our nation's continued reliance on employer-sponsored health insurance.

Many aspects of these issues have not been explored before, and Dr. Bradley's research is providing valuable insights that can be used by policy makers, employers, health insurance plans, and patients. Her insights will help to inform interventions to manage symptoms and rehabilitation services for patients and also may lead to the development of workplace policies that help cancer survivors resume and continue to work.

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Recent publications of interest

Bradley CJ, Neumark D, Luo Z, Bednarek HL. Employment-contingent health insurance, illness, and labor supply of women: evidence from married women with breast cancer. Health Econ 2007 Jul;16(7):719-37. [View Abstract]

Bouknight RR, Bradley CJ, Luo Z. Correlates of return to work for breast cancer survivors. J Clin Oncol 2006 Jan 20;24(3):345-53. [View Abstract]

Bradley CJ, Neumark D, Luo Z, Bednarek H, Schenk M. Employment outcomes of men treated for prostate cancer. J Natl Cancer Inst 2005 Jul 6;97(13):958-65. [View Abstract]

Bradley CJ, Neumark D, Bednarek HL, Schenk M. Short-term effects of breast cancer on labor market attachment: results from a longitudinal study. J Health Econ 2005 Jan;24(1):137-60. [View Abstract]

Steiner JF, Cavender TA, Main DS, Bradley CJ. Assessing the impact of cancer on work outcomes: what are the research needs? Cancer 2004 Oct 15;101(8):1703-11. Review. [View Reference Information]

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