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Abstract

When 21 million people got insurance through the Affordable Care Act's Medicaid expansion in 2014, how many healthcare jobs were created? We study the supply response to a large expansion of health insurance to low income Americans using both firm and worker data. Comparing states which expanded Medicaid eligibility to the states which still have not, we measure firm employment, wages, and healthcare facility counts as well as worker income and hours. Leveraging data about non-healthcare firms, we are able to difference out common labor market trends to remove some bias in the selection of expansion/non-expansion states. We find Medicaid expansion is associated with increases in average healthcare wages in rural counties. Expansion is also associated with increases in healthcare employment and no increase in facility count. These increases in employment don't seem to be driven by increases in any particular healthcare occupations, meaning that labor supply seems to respond for the full set of healthcare industry occupations. These results can help us understand the policy effects and geography of large insurance expansions and the elasticity of healthcare labor markets. In fact, Medicaid expansion is still available as a policy option to several states who have yet to expand. In order to improve quality, Medicare began penalizing hospitals with high readmissions rates for patients with several common and serious conditions. Our research shows that hospitals which would suffer penalties for additional readmissions reduced readmission rates for Medicare patients as well as patients with private health insurance, including patients on Medicare Advantage plans. This is evidence of strong spillover effects from insurer quality incentives, meaning that hospitals are likely to respond to quality incentives provided by one insurer by improving quality for all patients. This implies that a competitive insurance market may under-provide quality incentives. We measure the contribution of mergers and acquisitions (M&A) to the rise in industry concentration in the U.S. since 1982. We use data from the Economic Censuses, measuring changes in concentration (C4) and the increase in concentration due to changes in the ownership of establishments within each industry. We present results aggregated into six major industrial sectors. With the exception of the manufacturing sector, M&A accounts for a relatively small proportion of the rise in concentration, ranging from 18% in Wholesale Trade to 37% in Services. Aggregating changes in concentration across sectors, we find that M&A only accounts for 32% of the total increase in industry concentration from 1982 to 2012.

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