Early Impacts of the Affordable Care Act on Health Insurance Coverage in Medicaid Expansion and Non-Expansion States
01 Jan 2017-Journal of Policy Analysis and Management (J Policy Anal Manage)-Vol. 36, Iss: 1, pp 178-210
TL;DR: The causal effects of the ACA on health insurance coverage in 2014 using data from the American Community Survey are estimated using difference- in-difference-in-differences models that exploit cross-sectional variation in the intensity of treatment arising from state participation in the Medicaid expansion and local area pre-ACA uninsured rates.
Abstract: The Affordable Care Act (ACA) aimed to achieve nearly universal health insurance coverage in the United States through a combination of insurance market reforms, mandates, subsidies, health insurance exchanges, and Medicaid expansions, most of which took effect in 2014. This paper estimates the causal effects of the ACA on health insurance coverage in 2014 using data from the American Community Survey. We utilize difference-in-difference-in-differences models that exploit cross-sectional variation in the intensity of treatment arising from state participation in the Medicaid expansion and local area pre-ACA uninsured rates. This strategy allows us to identify the effects of the ACA in both Medicaid expansion and non-expansion states. Our preferred specification suggests that, at the average pre-treatment uninsured rate, the full ACA increased the proportion of residents with insurance by 5.9 percentage points compared to 2.8 percentage points in states that did not expand Medicaid. Private insurance expansions from the ACA were due to increases in both employer-provided and non-group coverage. The coverage gains from the full ACA were largest for those without a college degree, non-whites, young adults, unmarried individuals, and those without children in the home. We find no evidence that the Medicaid expansion crowded out private coverage.
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TL;DR: Policy makers should build on progress made by the Affordable Care Act by continuing to implement the Health Insurance Marketplaces and delivery system reform, increasing federal financial assistance for Marketplace enrollees, introducing a public plan option in areas lacking individual market competition, and taking actions to reduce prescription drug costs.
Abstract: Importance The Affordable Care Act is the most important health care legislation enacted in the United States since the creation of Medicare and Medicaid in 1965. The law implemented comprehensive reforms designed to improve the accessibility, affordability, and quality of health care. Objectives To review the factors influencing the decision to pursue health reform, summarize evidence on the effects of the law to date, recommend actions that could improve the health care system, and identify general lessons for public policy from the Affordable Care Act. Evidence Analysis of publicly available data, data obtained from government agencies, and published research findings. The period examined extends from 1963 to early 2016. Findings The Affordable Care Act has made significant progress toward solving long-standing challenges facing the US health care system related to access, affordability, and quality of care. Since the Affordable Care Act became law, the uninsured rate has declined by 43%, from 16.0% in 2010 to 9.1% in 2015, primarily because of the law’s reforms. Research has documented accompanying improvements in access to care (for example, an estimated reduction in the share of nonelderly adults unable to afford care of 5.5 percentage points), financial security (for example, an estimated reduction in debts sent to collection of $600-$1000 per person gaining Medicaid coverage), and health (for example, an estimated reduction in the share of nonelderly adults reporting fair or poor health of 3.4 percentage points). The law has also begun the process of transforming health care payment systems, with an estimated 30% of traditional Medicare payments now flowing through alternative payment models like bundled payments or accountable care organizations. These and related reforms have contributed to a sustained period of slow growth in per-enrollee health care spending and improvements in health care quality. Despite this progress, major opportunities to improve the health care system remain. Conclusions and Relevance Policy makers should build on progress made by the Affordable Care Act by continuing to implement the Health Insurance Marketplaces and delivery system reform, increasing federal financial assistance for Marketplace enrollees, introducing a public plan option in areas lacking individual market competition, and taking actions to reduce prescription drug costs. Although partisanship and special interest opposition remain, experience with the Affordable Care Act demonstrates that positive change is achievable on some of the nation’s most complex challenges.
573 citations
TL;DR: It is found that the ACA-facilitated state-level expansions of Medicaid in 2014 increased insurance coverage and access to care among the targeted population of low-income childless adults and increased use of certain forms of preventive care, but there is no evidence that they increased ex ante moral hazard.
Abstract: The U.S. population receives suboptimal levels of preventive care and has a high prevalence of risky health behaviors. One goal of the Affordable Care Act (ACA) was to increase preventive care and improve health behaviors by expanding access to health insurance. This paper estimates how the ACA-facilitated state-level expansions of Medicaid in 2014 affected these outcomes. Using data from the Behavioral Risk Factor Surveillance System, and a difference-in-differences model that compares states that did and did not expand Medicaid, we examine the impact of the expansions on preventive care (e.g., dental visits, immunizations, mammograms, cancer screenings), risky health behaviors (e.g., smoking, heavy drinking, lack of exercise, obesity), and self-assessed health. We find that the expansions increased insurance coverage and access to care among the targeted population of low-income childless adults. The expansions also increased use of certain forms of preventive care, but there is no evidence that they increased ex ante moral hazard (i.e., there is no evidence that risky health behaviors increased in response to health insurance coverage). The Medicaid expansions also modestly improved self-assessed health.
344 citations
Posted Content•
TL;DR: The Medicaid expansions were associated with large increases in Medicaid coverage, for example, 50 percent among childless adults, and corresponding decreases in the proportion uninsured, and there was relatively little change in private insurance coverage, although the expansions tended to decrease such coverage slightly.
Abstract: We examined the effect of the expansion of Medicaid eligibility under the Affordable Care Act on health insurance coverage and labor supply of low-educated and low-income adults. We found that the Medicaid expansions were associated with large (e.g., 50 percent) increases in Medicaid coverage and corresponding decreases in the proportion uninsured. There was relatively little change in private insurance coverage, although the expansions tended to decrease such coverage slightly. In terms of labor supply, estimates indicated that the Medicaid expansions had little effect on work effort despite the substantial changes in health insurance coverage. Most estimates suggested that the expansions increased work effort, although not significantly.
191 citations
TL;DR: This paper examined the effect of the expansion of Medicaid eligibility under the Affordable Care Act on health insurance coverage and labor supply of low-educated and low-income adults, and found that the Medicaid expansions were associated with large increases in Medicaid coverage, for example, 50 percent among childless adults and corresponding decreases in the proportion uninsured.
Abstract: We examined the effect of the expansion of Medicaid eligibility under the Affordable Care Act on health insurance coverage and labor supply of low-educated and low-income adults. We found that the Medicaid expansions were associated with large increases in Medicaid coverage, for example, 50 percent among childless adults, and corresponding decreases in the proportion uninsured. There was relatively little change in private insurance coverage, although the expansions tended to decrease such coverage slightly. In terms of labor supply, estimates indicated that the Medicaid expansions had little effect on work effort despite the substantial changes in health insurance coverage. Most estimates suggested that the expansions increased work effort, although not significantly.
164 citations
TL;DR: The results imply that reverting to pre-ACA eligibility levels would lead to particularly large increases in rural hospital closures, and future congressional efforts to reform Medicaid policy should consider the strong relationship between Medicaid coverage levels and the financial viability of hospitals.
Abstract: Decisions by states about whether to expand Medicaid under the Affordable Care Act (ACA) have implications for hospitals’ financial health. We hypothesized that Medicaid expansion of eligibility for childless adults prevents hospital closures because increased Medicaid coverage for previously uninsured people reduces uncompensated care expenditures and strengthens hospitals’ financial position. We tested this hypothesis using data for the period 2008–16 on hospital closures and financial performance. We found that the ACA’s Medicaid expansion was associated with improved hospital financial performance and substantially lower likelihoods of closure, especially in rural markets and counties with large numbers of uninsured adults before Medicaid expansion. Future congressional efforts to reform Medicaid policy should consider the strong relationship between Medicaid coverage levels and the financial viability of hospitals. Our results imply that reverting to pre-ACA eligibility levels would lead to particula...
116 citations
References
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TL;DR: In this article, the authors randomly generate placebo laws in state-level data on female wages from the Current Population Survey and use OLS to compute the DD estimate of its "effect" as well as the standard error of this estimate.
Abstract: Most papers that employ Differences-in-Differences estimation (DD) use many years of data and focus on serially correlated outcomes but ignore that the resulting standard errors are inconsistent. To illustrate the severity of this issue, we randomly generate placebo laws in state-level data on female wages from the Current Population Survey. For each law, we use OLS to compute the DD estimate of its “effect” as well as the standard error of this estimate. These conventional DD standard errors severely understate the standard deviation of the estimators: we find an “effect” significant at the 5 percent level for up to 45 percent of the placebo interventions. We use Monte Carlo simulations to investigate how well existing methods help solve this problem. Econometric corrections that place a specific parametric form on the time-series process do not perform well. Bootstrap (taking into account the autocorrelation of the data) works well when the number of states is large enough. Two corrections based on asymptotic approximation of the variance-covariance matrix work well for moderate numbers of states and one correction that collapses the time series information into a “pre”- and “post”-period and explicitly takes into account the effective sample size works well even for small numbers of states.
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TL;DR: This work considers statistical inference for regression when data are grouped into clusters, with regression model errors independent across clusters but correlated within clusters, when the number of clusters is large and default standard errors can greatly overstate estimator precision.
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3,236 citations
TL;DR: In this paper, the authors investigated the applicability of synthetic control methods to comparative case studies and found that, following Proposition 99, tobacco consumption fell markedly in California relative to a comparable synthetic control region, and that by the year 2000 annual per-capita cigarette sales in California were about 26 packs lower than what they would have been in the absence of Proposition 99.
Abstract: Building on an idea in Abadie and Gardeazabal (2003), this article investigates the application of synthetic control methods to comparative case studies. We discuss the advantages of these methods and apply them to study the effects of Proposition 99, a large-scale tobacco control program that California implemented in 1988. We demonstrate that, following Proposition 99, tobacco consumption fell markedly in California relative to a comparable synthetic control region. We estimate that by the year 2000 annual per-capita cigarette sales in California were about 26 packs lower than what they would have been in the absence of Proposition 99. Using new inferential methods proposed in this article, we demonstrate the significance of our estimates. Given that many policy interventions and events of interest in social sciences take place at an aggregate level (countries, regions, cities, etc.) and affect a small number of aggregate units, the potential applicability of synthetic control methods to comparative cas...
2,815 citations
DOI•
01 Jan 2008
TL;DR: This report presents data on income, poverty, and health insurance coverage in the United States based on information collected in the 2008 and earlier Annual Social and Economic Supplements (ASEC) to the Current Population Survey (CPS) conducted by the U.S Census Bureau.
Abstract: This report presents data on income, poverty, and health insurance coverage in the United States based on information collected in the 2008 and earlier Annual Social and Economic Supplements (ASEC) to the Current Population Survey (CPS) conducted by the U.S. Census Bureau. Data presented in this report indicate the following: • Real median household income increased between 2006 and 2007—the third annual increase.1 • The poverty rate was not statistically different between 2006 and 2007. • Both the number and the percentage of people without health insurance coverage decreased between 2006 and 2007. These results were not uniform across groups. For example, between 2006 and 2007, real median household income rose for non-Hispanic Whites and Blacks but remained statistically unchanged for Asians and Hispanics; the poverty rate increased for children under 18 years old but remained statistically unchanged for people 18 to 64 years old and people 65 and over; and the percentage of people without health insurance decreased for the native-born population, while the foreign-born population remained statistically unchanged.2, 3 These results are discussed in more detail in the three main sections of this report income, poverty, and health insurance coverage. Each section presents estimates by characteristics such as race, Hispanic origin, nativity, and region. Other topics include earnings of year-round, full-time workers; families in poverty; and health insurance coverage of children. This report concludes with a section discussing health insurance coverage by state using 2- and 3-year averages.
1,727 citations
01 Mar 2015
TL;DR: The U.S. population is projected to grow more slowly in future decades than in the recent past, as these projections assume that fertility rates will continue to decline and that there will be a modest decline in the overall rate of net international migration as discussed by the authors.
Abstract: Between 2014 and 2060, the U.S. population is projected to increase from 319 million to 417 million, reaching 400 million in 2051. The U.S. population is projected to grow more slowly in future decades than in the recent past, as these projections assume that fertility rates will continue to decline and that there will be a modest decline in the overall rate of net international migration. By 2030, one in five Americans is projected to be 65 and over; by 2044, more than half of all Americans are projected to belong to a minority group (any group other than non-Hispanic White alone); and by 2060, nearly one in five of the nation’s total population is projected to be foreign born.
1,267 citations
"Early Impacts of the Affordable Car..." refers background in this paper
...Multiplying our results (1.1 percentage point increase in private coverage) by the number of US residents (199 million; Colby and Ortman, 2015) in the 18-64 25 In addition, our results from table 4 suggest that the Medicaid expansion increased Medicaid enrollment by 3.2 percentage points at the…...
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