The Medicaid notch, labor supply, and welfare participation: Evidence from eligibility expansions

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Abstract
I assess the impact of losing public health insurance on the labor market decisions of women by examining a series of Medicaid eligibility expansions targeted toward young children. These targeted expansions severed the historical tie between AFDC and Medicaid eligibility. The reforms allowed a mother's earnings to increase without affecting her young children's public health insurance. Increasing the income limit for Medicaid resulted in a decrease in AFDC participation and an increase in labor force participation among these women. The effects were large for ever-married women, but were negligible for never-married women.
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