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The causal effect of tighter disability benefit eligibility on health outcomes amongst older English people

Funder: UK Research and InnovationProject code: ES/Z503356/1
Funded under: ESRC Funder Contribution: 200,442 GBP

The causal effect of tighter disability benefit eligibility on health outcomes amongst older English people

Description

In 2013, the UK began a major reform to disability benefits affecting more than 1 in 20 people in the country. This reform replaced Disability Living Allowance (DLA) with Personal Independence Payments (PIP). Like DLA, PIP is a benefit meant to help with costs associated with severe health conditions or disability. However, PIP is more stringent in terms of assessment and subsequent re-assessment of eligibility. The effect of this greater stringency on physical and mental health, owing to increased stress and anxiety within a vulnerable population, is unknown. We will estimate the impact on mortality and on mental health, across different types of claimants and we will explore the mechanisms that drive this. Our project will provide credible quantitative evidence on this spillover from economic policy to population health that could improve decision-making by policy makers. The challenge addressed: what and how? A simple comparison of people claiming PIP and people claiming DLA would not reveal the causal effect of greater stringency on health and mental health. This is because there are underlying differences between the types of people who claim each benefit. Similarly, a before and after comparison of people moving from DLA to PIP would not reveal the causal effect, because there have been other determinants of physical and mental health that have changed over time since 2013. However, it is causal effects that we need to estimate in order to evaluate this reform and to provide an evidence base for future reforms. From October 2015, most existing DLA claimants with indefinite awards and without changes in circumstances were contacted by the DWP and instructed to apply for PIP. However, those recipients born before 8th April 1948 were exempted from the requirement to apply for PIP and could continue claiming DLA indefinitely. This decision generates a sharp jump in the likelihood of moving from DLA to PIP between people with very similar dates of birth who should otherwise be similar to each other. Our project will use this policy-induced jump in a Regression Discontinuity Design (RDD), a credible and widely used technique in applied econometrics, to identify the causal effect of the reform. Aims and objectives It has now been 10 years since the transition from DLA to PIP began, but this potentially impactful reform has yet to be rigorously quantitatively evaluated. Beyond providing the first attempt to do this, we will advance understanding of the determinants of mental health in this vulnerable population. We will uncover the impact that economic insecurity has on health outcomes. The findings of our project will form the basis of at least three peer-reviewed journal articles that will be widely disseminated to academic and non-academic audiences, international conference presentations, policy briefs and blogs. Potential applications and benefits Disability benefit reform is a contentious issue and an active area of policy debate within the UK and internationally. Current reforms to disability benefit in Scotland, for example, are a partial unwinding of the reform that we are studying in this project. Our results can inform likely effects of such a policy among the elderly. In addition, evidence on the impact of economic insecurity on mental health, more generally, is of interest because of policy debates in the NHS regarding waiting times, health inequalities and the challenges associated with an ageing population.

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