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Boudreaux research examines eye-care labor market outcomes

Working paper: Michel Boudreaux, et al. (2018). Medicaid Benefit Generosity and Labor Market Outcomes: Evidence from Medicaid Adult Vision Benefits. SSRN Electronic Journal. DOI: 10.2139/ssrn.3101045

More than half of adults in the United States have clinically significant eyesight problems that can compromise their performance in the workplace. While many people can afford to improve their vision with eyeglasses or contact lenses, that can be a financial burden for workers on Medicaid.

Yet states have leeway in deciding which benefits are available to their enrollees - and access to vision coverage isn't universal, according to Faculty Associate Michel Boudreaux and his co-author Brandy Lipton, San Diego State University, Vision coverage policies vary across states, with some states not providing any coverage, some covering exams to assess visual acuity, and some covering exams and eyeglasses for vision correction, they note.

The two analyzed the effects of Medicaid vision benefits in the workforce and found evidence that coverage may boost productivity. Vision coverage doesn't appear to affect whether adults are employed or unemployed, but those with coverage do tend to work more hours and to be employed in occupations that require a higher level of skill, according to the authors.

Boudreaux and Lipton analyzed data from the Current Population Survey administered between 2002 and 2013. They reviewed statistics such as full-time and part-time employment status, hours worked, hourly wages and occupational skill level. Then they mapped those data points to state-by-state data on Medicaid adult vision coverage collected by the Kaiser Family Foundation. Crucially, they looked at before-and-after data from states that changed their policies to newly offer vision coverage. That allowed the researchers to zero in on the effects vision coverage had on employment.

Controlling for factors such as poverty level and additional insurance coverage, the authors found that vision coverage under Medicaid didn't appear to affect whether workers were employed or unemployed. Vision coverage also didn't appear to boost hourly wages.

But those who were employed and lived in states with generous vision benefits were about 13 percent more likely to work full-time than part-time than those who lived in states with no or limited Medicaid vision coverage. Workers living in states that offer Medicaid adult vision coverage also tended to have higher occupational skill levels than uncovered workers. That suggests vision coverage may facilitate switching to higher-skilled occupations.

Overall, the findings suggest that expanding vision coverage under Medicaid can have tangible benefits to workers' career prospects. Further work is needed to tease out how other individual benefits within insurance policies affect economic outcomes, they say.