The Impact of Medicare Part D on Self-Employment

Abstract

We explore the relationship between access to affordable health insurance and self-employment using exogenous variation from the introduction of Medicare Part D that reduced the out-of-pocket cost of prescription drugs and improved health outcomes in a difference-in-differences model using the American Community Survey. We find that our treatment group of individuals aged 65-69 were 0.5 percentage points (or 5%) more likely to be self-employed in relation to a control group aged 60-64.

Keywords: Medicare; Part D; entrepreneurship; health insurance; self-employment.