Effect of mass layoffs on health insurance expenditures: the case of the Ostrava region

Abstract

Economics(see Šrám & Dostál, 2012) in a situation where the life expectancy for both men and women in the Moravian-Silesian Region is already below the nation-wide average (73.81 years for men and 79.99 for women in the Region in 2013, compared to the national average of 75. 91 and 80.80, respectively).The objective of the paper is to analyse the health status and health insurance expenditures for employees concerned by the AMO mass layoffs. The paper tests the hypothesis that closing down a large heavy industry facility increases the risk of morbidity among the laid-off population and leads to an increase in healthcare expenditures. Quantifi cation of this hypothesis is based on a data set provided by Česká průmyslová zdravotní pojišťovna, a.s. (the primary insurance company of AMO Group employees). The relationship between unemployment and health, including morbidity by cause, is estimated using relative risk indicators. Unemployment and HealthSystematic attention is paid to the direction of the causal relation between unemployment and health and its mechanisms. Although the majority of research supports the conclusion that unemployment causes worsening of health (e.g., Gordo, 2006;Kuhn et al., 2009), opposite views also exist. Salm (2009) monitored health of individuals for a period of four years after a job loss and found no statistically signifi cant causal effect of unemployment on population health, although he did fi nd worsened health among the unemployed. Salm (2009, p. 22) states that "many people with health problems voluntarily terminate their employment with respect to their health and prefer to be unemployed". Although the latter perspective is relatively rare in international literature, it indicates the necessity to control the effect of subjective factors on the job loss of specifi c individuals. One of the approaches to controlling such factors (and the related reverse causality) is to restrict the research only on cases where an entire plant or facility has been closed down. The plant-closure approach eliminates subjective factors on the job loss of specifi c individuals: all the employees without exception lose their jobs when a plant is closed down (see section 2.1). Results of this type of analysis have been published by Schröder (2013), Kuhn et al. (2009), Schmitz (2011), or Browning and Heinesen (2012.Even the threat of losing a job is in itself a health risk, in virtually the same extent as unemployment (Kim & Knesebeck, 2015). In terms of length of unemployment, Gordo (2006) found a signifi cant negative effect of short-term unemployment only on men, and on both sexes for long-term unemployment. Moreover, Kuhn et al. (2009) state that in the short term, only the increase in mental diseases is statistically signifi cant; an increase in somatic diseases can only be proven in longer periods of unemployment.Particularly in the USA, a job loss is frequently immediately linked to a loss of health insurance and reduced or factually unavailable sophisticated healthcare (e.g., Baicker et al...

Chronic diseases and labour resources: “Old and new” European Union member states

“…As previous paragraphs show the complex relationship between the health and paid work the important relationship may be found also between health and unemployment. Among many others e. g. Louda et al (2018) in their study about effects of mass layoffs on health insurance expenditure found significant difference between the annual costs of treatment of employed (€ 536.8 a year) and unemployed persons (€ 705.4 a year) in their research sample from one of the region of Czech Republic. The difference of € 168.6 means that the costs of treating the unemployed are 31% higher than those for treating the employed, being higher than the relative increase in the risk of disease.…”