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Evaluation of a Placement Coaching Program for Recipients of Disability Insurance Benefits in Switzerland

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Abstract

Purpose During 2009‒2013 a pilot project was carried out in Zurich which aimed to increase the income of disability insurance (DI) benefit recipients in order to reduce their entitlement to DI benefits. The project consisted of placement coaching carried out by a private company that specialized in this field. It was exceptional with respect to three aspects: firstly, it did not include any formal training and/or medical aid; secondly, the coaches did not have the possibility of providing additional financial incentives or sanctioning lack of effort; and thirdly due to performance bonuses, the company not only had incentives to bring the participants into (higher paid) work, but also to keep them there for 52 weeks. This paper estimates the medium-run effects of the pilot project and assesses the net benefit from the Swiss social security system. Methods Different propensity score matching estimators are applied to administrative longitudinal data in order to construct suitable control groups. Results The estimates indicate a reduction in DI benefits and an increase in income even in the medium-run. A simple cost–benefit analysis suggests that the pilot project was a profitable investment for the social security system. Conclusion Given a healthy labor market, it seems possible to enhance the employment prospects of disabled persons with a relatively inexpensive intervention, which does not include any explicit investments in human capital.

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Notes

  1. This section is based on http://www.zas.admin.ch/org/00858/00861/index.html?lang=en.

  2. CHF = Swiss Franc, currency and legal tender of Switzerland.

  3. Here “psmatch2” implemented in STATA by Leuven and Sianesi [27] is applied. STATA is the statistical software created by StataCorp LLC, 4905 Lakeway Drive, College Station, Texas 77845-4512, USA.

  4. Huber et al. [32] implement this estimator in STATA with the command “radiusmatch”.

  5. Average annual unemployment rates: 3.7% in 2009, 3.6% in 2010, 2.9% in 2011, 3.0% in 2012, 3.2% in 2013, 3.3% in 2014. Source: own calculation based on http://www.amstat.ch.

  6. Although this may seem odd at first glance, using the same person as a control for many times is a common practice, for example, in nearest neighbor matching with replacement. Also a pooled panel regression can be interpreted as using untreated individuals several times as controls.

  7. For example, the median propensity score (linear index) of the untreated individuals is − 2.77 in 2009 and − 1.88 in 2010.

  8. This relative increase of 37% can be roughly calculated as follows: from the graph in the bottom-left of Fig. 3 it can be seen that the counterfactual income is approximately CHF 7500. CHF 2750/CHF 7500 is approximately 37%

  9. Exchange rates at 16-March-2016.

  10. This number is the sum of the contribution rates of the AHV (8.4%), IV (1.4%), EO (0.5%), and the ALV (2.2%). Source: Federal Social Insurance Office (FISO), Switzerland

  11. Exchange rates at 16-March-2016.

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Acknowledgements

The author would like to thank the anonymous reviewers for their helpful and constructive comments that greatly contributed to improving the final version of the paper.

Funding

This paper is based on the project “Evaluation Pilotprojekt Ingeus—berufliche Wiederein-gliederung von Rentenbeziehenden der Invalidenversicherung” funded by the Federal Social Insurance Office (FISO), Switzerland. It does not necessarily reflect the opinions and views held by the FISO.

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  1. Frankfurt University of Applied Sciences, Nibelungenplatz 1, 60318, Frankfurt am Main, Germany

    Tobias Hagen

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Author Tobias Hagen declares that he has no conflict of interest.

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All procedures performed in studies involving human participants were in accordance with the ethical standards of the institutional and/or national research committee and with the 1964 Helsinki declaration and its later amendments or comparable ethical standards.

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Fig. 5
figure 5

Kernel density estimate and histogram (frequency) of the propensity score estimates

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Hagen, T. Evaluation of a Placement Coaching Program for Recipients of Disability Insurance Benefits in Switzerland. J Occup Rehabil 29, 72–90 (2019). https://doi.org/10.1007/s10926-018-9766-x

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