The ACA: Some Unpleasant Welfare Arithmetic

Casey B. Mulligan

NBER Working Paper No. 20020
Issued in March 2014
NBER Program(s):   EFG   HE   LS   PE

Under the Affordable Care Act, between six and eleven million workers would increase their disposable income by cutting their weekly work hours. About half of them would primarily do so by making themselves eligible for the ACA's federal assistance with health insurance premiums and out-of-pocket health costs, despite the fact that subsidized workers are not able to pay health premiums with pre-tax dollars. The remainder would do so primarily by relieving their employers from penalties, or the threat of penalties, pursuant to the ACA's employer mandate. Women, especially those who are not married, are more likely than men to have their short-term financial reward to full-time work eliminated by the ACA. Additional workers, beyond the six to eleven million, could increase their disposable income by using reduced hours to climb one of the "cliffs" that are part of the ACA's mapping from household income to federal assistance.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Information about Free Papers

You should expect a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


The NBER Bulletin on Aging and Health provides summaries of publications like this.  You can sign up to receive the NBER Bulletin on Aging and Health by email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w20020

Users who downloaded this paper also downloaded these:
Mulligan w19936 The Economics of Work Schedules under the New Hours and Employment Taxes
Borjas and Doran w20026 Which Peers Matter? The Relative Impacts of Collaborators, Colleagues, and Competitors
Newhouse, Price, McWilliams, Hsu, and McGuire w20021 How Much Favorable Selection Is Left in Medicare Advantage?
Pakes w20022 Behavioral and Descriptive Forms of Choice Models
Houde w20019 How Consumers Respond to Environmental Certification and the Value of Energy Information
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us