Haolin Wu 

Job Market Paper

Avoiding the Premium on the Premium? Self-funded Health Benefit Plans and Corporate Financial Decisions 

Abstract: This paper documents that firms choose to adopt self-funded health benefit plans as an optimal corporate financial policy in response to the rising Employer Sponsored Health Insurance (ESI) costs in the United States. Under self-insurance, employers avoid the high premiums charged by insurance carriers but assume greater financial risk associated with medical claims. I argue that this shift is driven by increasing insurer market concentration, which renders external insurance coverage increasingly costly for employers. Exploiting large national health insurer mergers and acquisitions (M&A) as a source of exogenous variation in insurer markups, I establish a causal relationship that increases in local health insurance premiums significantly raise the likelihood that firms adopt self-insured plans. Compared to fully insured firms, self-insured firms are better able to preserve shareholder value amid escalating health insurance costs. However, in response to higher expected medical claims, these firms experience reduced cash flows and adjust financial policy by cutting capital expenditures.

Work in Progress

The Impact of Opioid Crisis on Personal Bankruptcy 

This paper examines the impact of the opioid crisis on household bankruptcy filings in the United States. Exploiting the staggered legalization of state-level recreational marijuana laws as an exogenous source of variation in the availability of a substitute for opioids, I find that reductions in drug overdose death rates are associated with lower rates of personal bankruptcy filings. This relationship is consistent with standard theories of personal bankruptcy, whereby consumers in opioid-affected areas are more likely to file when the net benefit from debt discharge is greater, supporting the strategic motive for bankruptcy claims. Furthermore, the effect is particularly pronounced in areas with lower health insurance coverage, where households face higher out-of-pocket medical costs.

New Evidence on the Gender Punishment Gap  (with Susanna Gibbons and Olivia Starr)

In this paper we examine whether female CEOs are more harshly punished after negative earnings surprises than their male counterparts.We studied earnings releases relative to analyst expectations, and subsequent stock market performance for companies in the S&P 500 from 2011 - 2024. We found that male and female CEOs generated similar levels of both positive and negative earnings surprises -  there is no significant difference in performance, size of firm, or number of earnings surprises between male and female CEOs. We found that companies with female CEOs experience a greater drop in stock price following the most negative earnings surprises. Additionally, we found that companies with women in the CEO role also experience a greater increase  in stock price after the most positive earnings surprises. Finally, we observed a temporal difference in the distribution of stock returns: the market reacts immediately to male CEO results, but has a delayed reaction to female CEO results. Overall, these findings are generally consistent with the literature that examines how female leaders are perceived, punished, or rewarded for successes or failures, but suggest that individual biases may not be the mediating factor. Since it is the stock market which is delivering the punishment or reward rather than a specific boss or supervisor, we believe that systemic bias drives the result rather than a bias of individual perceptions. The temporal delay observed requires further analysis, but also suggests the presence of systemic bias which exerts growing influence on stock prices as news of the earnings surprise is disseminated.