Panel Paper: What Happens When You Wait? Effects of DI Wait Time on Health and Well-Being

Friday, November 9, 2018
8224 - Lobby Level (Marriott Wardman Park)

*Names in bold indicate Presenter

Sarah Prenovitz, Abt Associates, Inc.

While waiting for a decision, individuals who apply for Social Security Disability Insurance (DI) face strong incentives to remain out of the labor force and receive no monetary or health insurance benefits from the program. Although a substantial literature in economics has considered the effects of DI on workforce participation and earnings, the effects of the determination process have received much less attention and little is known about the program’s effects on other outcomes. In this paper I use linked survey and administrative data to identify the effect of time spent waiting for a decision on health, health care access, and financial well-being. I construct instruments that reflect expected waits in each state and month to identify effects of initial wait time. I find that a longer wait decreases the likelihood that an applicant has benefits terminated at the time of survey and increases the likelihood that they are currently receiving benefits at that time. Wait time also harms some indicators of health. My results suggest that even small increases in wait time can have negative implications for the well-being of applicants, and that these extend beyond labor force participation.

Full Paper: