Researchers from Harvard School of Public Health (HSPH), Massachusetts Institute of Technology (MIT), the National Bureau of Economic Research (NBER), and Providence Health & Services have found that expanding low income adults' access to Medicaid substantially increases health care use, reduces financial strain on covered individuals, and improves their self-reported health and well-being. This is the first study to evaluate the impact of insuring the uninsured in the U.S. using a randomized controlled trial, the gold standard in medical and scientific studies.
The study was released as working paper 17190 on the website of the National Bureau of Economic Research (NBER) on July 7, 2011 (www.nber.org).
"This study shows that Medicaid substantially expands access to and use of care for low-income adults relative to being uninsured," said Katherine Baicker, professor of health economics at HSPH and co-principal investigator of the study. Medicaid, which is jointly funded by the federal and state governments, covers the health care costs of eligible low-income individuals and families. The 2010 Affordable Care Act expands Medicaid to cover additional low income adults in all states in 2014.
In 2008, Oregon held a lottery to accept additional low-income, uninsured residents into its Medicaid program; about 90,000 applied for the 10,000 available openings. The researchers collected data on the lottery participants from many sources -- including hospital records and mail surveys -- and compared outcomes between those randomly selected by the lottery and those not selected in order to determine the impact of Medicaid.
Although many previous studies compare health or health care use between the insured and uninsured, inferring the impact of health insurance from such comparisons is difficult because differences between the insured and uninsured, such as in income, employment, or initial health, may affect the health and health care outcomes studied. This study is the first to avoid this problem by taking advantage of the random assignment created by the Oregon lottery.
Based on the first year of this ongoing study, some of the key findings show that Medicaid coverage:
Increases health care use:
"Some people wonder whether Medicaid coverage has any effect. The study findings make clear that it does. People reported that their physical and mental health were substantially better after a year of insurance coverage, and they were much less likely to have to borrow money or go into debt to pay for their care," said Amy Finkelstein, professor of economics at MIT and co-principal investigator of the study.
The current study is part of a broader research program that will follow the lottery participants for an additional year and will also directly measure health outcomes, including cholesterol, diabetic blood sugar control, blood pressure, and obesity.
Additional authors include: Sarah Taubman, NBER; Bill Wright, Providence Health & Services; Mira Bernstein, NBER; Jonathan Gruber, MIT and NBER, Joseph P. Newhouse, HSPH, Harvard Medical School, Harvard Kennedy School, and NBER; Heidi Allen, Providence Health & Services; and the Oregon Health Study Group.
Support for the study was provided by the National Institute on Aging, Office of the Assistant Secretary for Planning and Evaluation (Department of Health and Human Services), California HealthCare Foundation, Centers for Medicare & Medicaid Services, the John D. and Catherine T. MacArthur Foundation, Robert Wood Johnson Foundation, Sloan Foundation, Smith Richardson Foundation, and U.S. Social Security Administration. The study was conducted with the cooperation of the State of Oregon.
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