Volume 24, Number 1 (Winter) 1989
Blank, Rebecca M. 1989. "The Effect of Medical Need and Medicaid on AFDC Participation." Journal of Human Resources 24(1):54-87.
This paper investigates the need for medical insurance and the effect of Medicaid eligibility rules on the behavior of female-headed households with children, using 1980 data from the national Medical Care Utilization and Expenditure Survey. It estimates the extent to which health problems and the parameters of the Medicaid program affect AFDC participation, labor market involvement, and Medicaid usage among the Medically Needy. Health problems significantly increase AFDC participation, but neither the presence of a Medically Needy program nor the value of Medicaid insurance coverage has significant effects on AFDC usage. The medically Needy program appears to be used by households which experience significant medical problems, but which would be uninsured if this program were not available.
The author is a professor of economics at Princeton University. Support for this project was provided by the Institute for Research on Poverty, University of Wisconsin, and by the National Science Foundation, grant #SES-8606456. Susan Skeath provided helpful research assistance. The author thanks participants in seminars at Wisconsin, Princeton, Harvard, and Columbia for their useful comments, as well as the comments of the editor and anonymous referees; however, all opinions and errors remain the author's own.
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