Skip to main content
SpringerLink
Log in

An examination of the impact of health insurance enrollment in reducing racial health disparities

  • Published:
Journal of Economics and Finance Aims and scope Submit manuscript

Abstract

This paper investigates the effects of health insurance enrollment on health disparities among different racial groups in the United States. Two models were constructed and estimated empirically where a health insurance disparity model was nested in the health disparity model. The Blinder-Oaxaca decomposition method was used to measure potential racial discrimination in health status. The racial gap in health disparities was broken down by endowment and treatment effects. The results show that the health status gap can be explained by potential discrimination in health insurance enrollment between Blacks and Whites. Overall, health insurance enrollment plays a critical role in explaining racial disparities and a racial disparity in the healthcare industry explains a nontrivial portion of the differences in health status.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

Data availability

The data that support the findings of this study are available upon request.

Notes

  1. Major chronic diseases are categorized as heart disease, cancer, stroke, chronic obstructive pulmonary disease, and diabetes (Williams et al. 2003, Williams and Mohammed 2008).

  2. Disparities in Health and Health Care: Five Key Questions and Answers, Issue Brief (Artiga et al. 2016).

  3. The National Cancer Institute (NCI) explains that “disparities occur when members of certain population groups do not enjoy the same health status as other groups” while the National Institutes of Health (NIH) defines a disparity as “a difference in the incidence, prevalence, mortality, and burden of disease and other adverse health conditions that exist among specific population groups in the United States”.

  4. Economic disadvantage refers to low income or the inability to purchase goods and services, while social disadvantage indicates someone’s relative position determined by economic resources, race, ethnicity, or gender. Environmental disadvantage refers to a region where the concentration of poverty is high (Braveman 2014).

  5. There exists a huge disparity in chronic diseases, not in acute diseases, among different races (Williams et al. 2003, Williams and Mohammed 2008).

  6. The Centers for Disease Control and Prevention releases this survey annually.

  7. Respondent-rated health has been shown to be a predictor of mortality, net of adjustments for clinical measures of health status (Benyamini and Idler 1999; Idler and Benyamini 1997).

  8. Alternatively, we could use the scale variable as is, instead of dichotomizing it, using the ordered logit models. We tested the models and compared the results with those ones the binary logit models. We obtained consistent results.

  9. Private care insurance (PCI) is further categorized into predicted PCI using logit-estimated White coefficient (WPCI), predicted PCI using logit-estimated Black coefficient (BPCI), and Original predicted PCI (WBPCI).

  10. There are various measures of effect size, such as Cohen’s d, Hedges’s g, and Glass’s Δ, Point-biserial r and more. We include only Cohen’s d estimates due to the similarity of the measures.

References

  • Artiga S, Orgera K, Pham O (2016) Disparities in health and health care: Five key questions and answers. Washington, DC: Kaiser Family Foundation. http://kff.org/disparities-policy/issue-brief/disparities-in-health-and-health-carefive-key-questions-and-answers/ Accessed March 7, 2017

  • Bauer TK, Sinning M (2008) An extension of the blinder-oaxaca decomposition to non-linear models. AStA Advances in Statistical Analysis 92:197–206

  • Baicker K, Chandra A (2006) The labor market effects of rising health insurance premiums. J Labor Econ 24(3):609–634

    Article  Google Scholar 

  • Benyamini Y, Idler EL (1999) Community studies reporting association between self-rated health and mortality: Additional studies, 1995 to 1998. Res Aging 21(3):392–401

    Article  Google Scholar 

  • Blinder AS (1973) Wage discrimination: reduced form and structural estimates. J Human Resour 8:436–455

    Article  Google Scholar 

  • Bloom B, Cohen RA, Freeman G (2012) Summary health statistics for U.S. children: National health interview survey. Vital Health Stat 10(254):1–88

    Google Scholar 

  • Bourguignon F, Francisco HGF, Phillippe GL (2008) Beyond Oaxaca–Blinder: Accounting for differences in household income distributions. J Econ Inequal 6:117–148

    Article  Google Scholar 

  • Braveman P (2014) What are health disparities and health equity? We need to be clear. Public Health Rep 129:5

    Article  Google Scholar 

  • Coughlin SS, Matthews-Juarez P, Juarez PD, Melton CE, King M (2014) Opportunities to address lung cancer disparities among African Americans. Cancer Med 3(6):1467–1476

    Article  Google Scholar 

  • Dovidio JF, Penner LA, Albrecht TL, Norton WE, Gaertner SL, Shelton JN (2008) Disparities and distrust: The implications of psychological processes for understanding racial disparities in health and health care. Soc Sci Med. https://doi.org/10.1016/j.socscimed.2008.03.019

    Article  Google Scholar 

  • Dubowitz T, Heron M, Basurto-Davila R, Bird CE, Lurie N, Escarce JJ (2011) Racial/ethnic differences in U.S. health behaviors: A decomposition analysis. Am J Health Behav 35(3):290–304

    Article  Google Scholar 

  • Fairlie RW (1999) The absence of the african-american owned business: An analysis of the dynamics of self-employment. J Law Econ 17:80–108

    Google Scholar 

  • Fairlie RW (2005) An extension of the Blinder-Oaxaca decomposition technique to logit and probit models. J Econ Soc Meas 30(4):305–316

    Article  Google Scholar 

  • Feagin J, McKinney KD (2003) White out: The continuing significance of racism, 233

  • Freeman HP (2004) Poverty, culture, and social injustice: Determinants of cancer disparities. CA Cancer J Clin 54:72–77. https://doi.org/10.3322/canjclin.54.2.72

    Article  Google Scholar 

  • Headen A, Masia N (2005) Exploring the potential link between medicaid access restrictions, Physician location, and health disparities. Am J Manag Care, Special Issue 11:21–26

    Google Scholar 

  • Healthy People (2020) Washington, DC: U.S. Department of Health and Human Services, Office of Disease Prevention and Health Promotion [09/10/16]. Available from: https://www.healthypeople.gov/2020/about/foundation-health-measures/Disparities

  • Heckman J (1976) The common structure of statistical models of truncation, sample selection and limited dependent variables and a simple estimator for such models. Ann Econ Soc Meas 5(4):475–492

  • Heckman J (1979) Sample selection bias as a specification error. Econometrica 47(1):153–161

  • Hummer RA (1996) Black-white differences in health and mortality: A review and conceptual model. Sociol Q 37(1):105–125

    Article  Google Scholar 

  • Idler EL, Benyamini Y (1997) Self-rated health and mortality: a review of twenty-seven community studies. J Health Soc Behav 38(1):21–37

  • Institute of Medicine (2003) Unequal treatment: confronting racial and ethnic disparities in health care. The National Academies Press, Washington, DC. https://doi.org/10.17226/10260

    Book  Google Scholar 

  • Kirby JB, Taliaferro G, Zuvekas SH (2006) Explaining racial and ethnic disparities in health care. Med Care 44(5):64–72

    Article  Google Scholar 

  • Krieger N, Chen JT, Waterman PD, Rehkopf DH, Subramanian SV (2005) Painting a truer picture of US socioeconomic and racial/ethnic health inequalities: the Public Health Disparities Geocoding Project. Am J Public Health 95(2):312–323

    Article  Google Scholar 

  • Holmes GM, Freburger JK, Ku LJE (2012) Decomposing racial and ethnic disparities in the use of postacute rehabilitation care. Health Serv Res 47(3):1158–1178

    Article  Google Scholar 

  • Le Cook B, McGuire TG, Zaslavsky AM (2012) Measuring racial/ethnic disparities in health care: Methods and practical issues. Health Res Educational Trust 47(3):1232–1254

    Google Scholar 

  • Lillie-Blanton M, Hoffman C (2005) The role of health insurance coverage in reducing racial/ethnic disparities in health care. Health Aff 24(2):398–408. https://doi.org/10.1377/hlthaff.24.2.398

    Article  Google Scholar 

  • Manning WG, Newhouse JP, Duan N, Keeler EB, Leibowitz A (1987) Health insurance and the demand for medical care: Evidence from a randomized experiment. Am Econ Rev 77(3):251–277

    Google Scholar 

  • Marmot M (2002) The influence of income on health: Views of an epidemiologist. Health Aff 21(2):31–46

    Article  Google Scholar 

  • McGee DL, Liao Y, Cao G, Cooper RS (1999) Self-reported health status and mortality in a multiethnic US cohort. Am J Epidemiol 149(1):41–46. https://doi.org/10.1093/oxfordjournals.aje.a009725

    Article  Google Scholar 

  • Mwendwa DT, Gholson G, Sims RC, Levy S-A, Ali M, Harrell CJ, Campbell AL (2011) Coping with perceived racism: A significant factor in the development of obesity in African American women? J Natl Med Assoc 103:602–608

    Google Scholar 

  • Nanney MS, Myers SL, Xu M, Kent K, Durfee T, Allen ML (2019) The economic benefits of reducing racial disparities in health: The case of Minnesota. Int J Environ Res Public Health 16:742

    Article  Google Scholar 

  • Newhouse JP (1993) Lessons from the RAND health insurance experiment. Harvard University Press

    Google Scholar 

  • Oaxaca RL (1973) Male-female wage differentials in urban labor markets. Int Econ Rev 14:693–709

    Article  Google Scholar 

  • Philbin EF, Dec GW, Jenkins PL, DiSalvo TG (2001) Socioeconomic status as an independent risk factor for hospital readmission for heart failure. Am J Cardiol 87(12):1367–1371

    Article  Google Scholar 

  • Piccolo RS, Pearce N, Araujo AB, McKinlay JB (2014) The contribution of biogeographic ancestry and socioeconomic status to racial/ethnic disparities in type 2 diabetes: Results from the Boston area community health (BACH) survey. Ann Epidemiol 24(9):648–654. https://doi.org/10.1016/j.annepidem.2014.06.098

    Article  Google Scholar 

  • Postmes T, Branscombe NR (2002) Influence of long-term racial environmental composition on subjective well-being in African Americans. J Pers Soc Psychol 83(3):735

    Article  Google Scholar 

  • Puhani P (2000) The Heckman Correction for Sample Selection and Its Critique: A Short Survey. University of St, Gallen, p 14

    Google Scholar 

  • Sealy-Jefferson V, Wilson E (2015) Racial and ethnic health disparities and the affordable care act: A status update. J Racial Ethn Health Disparities 4(2):583–588. https://doi.org/10.1007/s40615-015-0113-z

    Article  Google Scholar 

  • Scott WK, Macera CA, Cornman CB, Sharpe PA (1997) Functional health status as a predictor of mortality in men and women over 65. J Clin Epidemiol 50(3):291–296

    Article  Google Scholar 

  • Sharma A, Colvin-Adams M, Yancy CW (2014) Heart failure in African Americans: disparities can be overcome. Clevel Clin J Med 81(5):301–311. https://doi.org/10.3949/ccjm.81a.13045

    Article  Google Scholar 

  • Sharma K, Grant D, Myckatyn TM (2015) The impact of race on choice of post-mastectomy reconstruction: is there a healthcare disparity? Plast Reconstr Surg 136(4S):114–115

    Article  Google Scholar 

  • Sims M, Diez-Roux AV, Dudley A, Gebreab S, Wyatt SB, Bruce MA, James SA, Robinson JC, Williams DR, Taylor HA (2012) Perceived discrimination and hypertension among African Americans in the Jackson Heart Study. Am J Public Health 102(Suppl 2):S258–S265. https://doi.org/10.2105/AJPH.2011.300523

    Article  Google Scholar 

  • Sommers BD, McMurtry CL, Blendon RJ, Benson JM, Sayde JM (2017) Beyond health insurance: Remaining disparities in US health care in the Post-ACA era. Milbank Q 95(1):43–69. https://doi.org/10.1111/1468-0009.12245

    Article  Google Scholar 

  • Underwood JM, Townsend JS, Tai E, Davis SP, Stewart SL, White A, Momin B, Fairley TL (2012) Racial and regional disparities in lung cancer incidence. Cancer 118(7):1910–1918

    Article  Google Scholar 

  • Vera-Hernández ÁM (1999) Duplicate coverage and demand for health care. The case of Catalonia. Health Econ 8(7):579–598

    Article  Google Scholar 

  • Weisfeld A, Perlman RL (2005) Disparities and discrimination in health care. Prospect Biol Med 48(1 Supplement):S1–S9. https://doi.org/10.13353/pbm.2005.0046

    Article  Google Scholar 

  • White AL, Vernon SW, Franzini L, Du XL (2010) Racial disparities in colorectal cancer survival: To what extent are racial disparities explained by differences in treatment, tumor or hospital characteristics? Cancer 116(19):4622–4631. https://doi.org/10.1002/cncr.25395

    Article  Google Scholar 

  • Williams DR, Collins C (2001) Racial residential segregation: a fundamental cause of racial disparities in health. Public Health Rep 116(5):404–414

    Article  Google Scholar 

  • Williams DR, Jackson PB (2005) Social sources of racial disparities in health. Health Aff 24(2):325–334. https://doi.org/10.1377/hlthaff.24.2.325

    Article  Google Scholar 

  • Williams DR, Mohammed SA (2008) Discrimination and racial disparities in health: Evidence and needed research. J Behav Med 32(20). https://doi.org/10.1007/s10865-008-9185-0

  • Williams D, Neighbors H (2001) Racism, discrimination and hypertension: evidence and needed research. Ethnicity & Disease 11(4):800–816

  • Williams DR, Neighbors HW, Jackson JS (2003) Racial/ethnic discrimination and health: findings from community studies. Am J Public Health 93(2):200–208. https://doi.org/10.2105/AJPH.93.2.200

    Article  Google Scholar 

  • Wooldridge JM (2002) Econometric Analysis of Cross Section and Panel Data. MIT Press, Cambridge, MA

    Google Scholar 

  • Yun MS (2004) Decomposing differences in the first moment. Econ Lett 82:275–280

    Article  Google Scholar 

Download references

Funding

This work was supported by Hankuk University of Foreign Studies Research Fund of 2023.

Author information

Authors and Affiliations

  1. Hankuk University of Foreign Studies, Seoul, South Korea

    In Jung Song

  2. Western Carolina University, Cullowhee, NC, USA

    Inhyuck “Steve” Ha

  3. University of Minnesota, Minneapolis, MN, USA

    Won Fy Lee

  4. Ewha Womans University, Seoul, South Korea

    Minjung Choi

Authors
  1. In Jung Song
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Inhyuck “Steve” Ha
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Won Fy Lee
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. Minjung Choi
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to In Jung Song.

Ethics declarations

Conflicts of interest

There is no conflict of interest with the publication of the present manuscript.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Song, I.J., Ha, I.“., Lee, W.F. et al. An examination of the impact of health insurance enrollment in reducing racial health disparities. J Econ Finan (2023). https://doi.org/10.1007/s12197-023-09650-x

Download citation

  • Accepted:

  • Published:

  • DOI: https://doi.org/10.1007/s12197-023-09650-x

Keywords

JEL Classification

Search

Navigation