NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The Reallocation of Compensation in Response to Health Insurance Premium Increases

Dana P. Goldman, Neeraj Sood, Arleen Leibowitz

NBER Working Paper No. 9540
Issued in March 2003
NBER Program(s):   HE   LE

This paper examines how compensation packages change when health insurance premiums rise. We use data on employee choices within a single large firm with a flexible benefits plan; an increasingly common arrangement among medium and large firms. In these companies, employees explicitly choose how to allocate compensation between cash and various benefits such as retirement, medical insurance, life insurance, and dental benefits. We find that a $1 increase in the price of health insurance leads to 52-cent increase in expenditures on health insurance. Approximately 2/3 of this increase is financed through reduced wages and 1/3 through other benefits

download in pdf format
   (466 K)

email paper

A non-technical summary of this paper is available in the August 2003 NBER digest.  You can sign up to receive the NBER Digest by email.

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.

This paper is available as PDF (466 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w9540

Published: Goldman, Dana P., Nerraj Sood and Arleen Leibowitz. "The Reallocation Of Compensation In Response To Health Insurance Premium Increases," Economics Letters, 2005, v88(2,Aug), 147-151.

Users who downloaded this paper also downloaded these:
Chen and Escarce w13461 Family Structure and the Treatment of Childhood Asthma
Pacula, , and Ringel w9963 Does Marijuana Use Impair Human Capital Formation?
Keller, Tan, Morel, and Bradford w7476 Preserving the Ocean Circulation: Implications for Climate Policy
Cutler and Madrian w5525 Labor Market Responses to Rising Health Insurance Costs: Evidence on Hours Worked
 
Publications
Activities
Meetings
Data
People
About

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

Contact Us