Health Insurance Motivated Disability Enrollment in an Era of Health Reform

For a variety of political, social and economic reasons, the US is unique in its reliance on employer-based private health insurance. Consequently, disability programs in the US must not only provide wage replacement, but also provide health insurance coverage. Many working-age adults with disabilities are unable to obtain affordable private insurance because of pre-existing conditions, high out-of-pocket costs, and low rates of employment. An unknown but presumably large portion of SSDI and SSI enrollees apply for disability benefits to become eligible for Medicare and/or Medicaid coverage, a phenomenon we call: Health Insurance Motivated Disability Enrollment; or HIMDE. Addressing HIMDE is one of the primary policy challenges in current federal efforts to encourage return-to-work (RTW).

While provisions of the 2010 Patient Protection and Affordable Care Act (PPACA) may be modified or even repealed, the federal government is clearly committed to increasing access to health insurance for working age adults, including adults with chronic health conditions and disabilities. If access to affordable public and private health insurance is increased, HIMDE should decline. Establishing baseline data on the prevalence of HIMDE; and evaluating its role in current SSA programming efforts; is critical in determining the impact of health reform on working age adults with disabilities. We hypothesize that implementation of PPACA will lead to a decrease in the number of SSDI applications, particularly among younger applicants with relatively high levels of education and/or work experience. This more favorable insurance environment may also encourage current SSDI beneficiaries to return to work.