Precarious Work, Precarious Care: Income Instability and Interruptions in Health Care Access

Access to health care is one of the key indicators of workers’ well-being, but monthly volatile income may undermine the continuity and affordability of care access. With the rise of precarious employment over the past few decades, it is not uncommon for employers to be reluctant to offer health insurance or other benefits. Further, workers bear the risk of losing jobs or experiencing hour variability, both of which are likely to intertwine with intermittent health insurance coverage.

Changes to the Medicaid eligibility rules under the One Big Beautiful Bill Act will exacerbate health care challenges for workers, especially those with irregular employment patterns and unpredictable income fluctuations. Previous research focusing on Canadian men aged 30 to 55 indicates that workers with less volatility in annual income have better self-rated health. Analyses of US samples with more frequent panel data show that increased monthly volatility is also associated with poorer self-rated health. Affordability and continuity of medical care may be key mechanisms linking income instability to health outcomes.

Using nationally representative monthly panel data, this article documents whether a worker’s earnings instability within a year links to their health insurance coverage gap during the year, net of other socio-economic characteristics. The sample includes workers aged 24 and older who reported being employed at the start of the interview and do not stop working or work part time due to any of the following reasons: taking a vacation, attending school, taking leave, experiencing chronic health problems or injury, or having family or personal obligations. I use data from the Survey of Income and Program Participation (SIPP) to determine whether workers have any health insurance coverage (private or public health insurance coverage) in the current survey month. The SIPP variable used is a binary time-variant measure that indicates whether a worker experienced any status change in health insurance coverage within the span of a year.

Figure 1

I find that income instability, when it is greater in magnitude and more frequent, is associated with increased likelihood of having intermittent health insurance coverage within a year. Specifically, workers experiencing high income volatility (defined as the upper third of the instability index) face significantly higher chances of intermittent care access (at 5.3 percent) than those with low or moderate volatility (around 2.5 percent) (see Figure 1).

Lower-income workers are consistently more exposed to insurance coverage gaps. At every volatility level, workers with incomes at or below 138 percent of the federal poverty line (FPL) have a higher probability of intermittent care access than workers overall (about 3.8 percent at low instability and just over 10 percent at high instability).

The gap widens at high-level volatility. Among this group, low-income workers are roughly twice as likely to experience intermittent health care access, after adjusting for age, gender, race or ethnicity, education, baseline health status, place of residence, income level, industry and whether they live in a household with children.

Figure 2

Figure 2 reports how the relationship between variable income and continuity of access to health care insurance differ by low-income workers’ race and ethnicity. We observe that such health care access differences across racial and ethnic groups are modest at low volatility but become pronounced when income volatility is high, suggesting that volatility amplifies existing inequities.

Low-income white and Black workers are consistently more exposed to health care coverage gaps over the course of a year. At every volatility level, Black and white workers with incomes at or below 138 percent of the FPL have a higher likelihood of intermittent care access than their other counterparts overall (see Figure 2). Another thing to note is that although Hispanic workers have comparatively lower rates at low and mid volatility, their chance of intermittent care access rises sharply under high volatility. In addition, supplemental analysis shows that among the overall workforce, Black, Hispanic, AAPI and other workers exhibit significantly increased probability of facing the insurance coverage gap relative to their white counterparts (results available upon request).

Because Medicaid and subsidized coverage are highly sensitive to short-term income variability, workers with irregular earnings face elevated risks of temporary disqualification, delayed re-enrollment, and fragmented care — even when their annual income may remain within eligibility ranges. This analysis does not address job switches and employer-driven scheduling changes separately. However, these are significant factors in within-year income instability, especially for workers employed in hotels and restaurants where quit rates are nearly 5 percent monthly. Their impact on health care access disruption may warrant a separate study. Nonetheless, policymakers can address intra-year coverage gaps and reduce administrative burdens by implementing more effective policies that promote public health.

This first appeared on CEPR.

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