Medicaid Expansions 2014: What Can Be Learned From the Oregon Health Insurance Experiment?
Methods: This analysis relies on both primary and secondary data sources to evaluate healthcare access, quality, financial strain, and self-reported health. We mailed a baseline and 12-month follow-up survey to almost 60,000 individuals who signed up for the lottery, approximately half who were selected (treatment) and half who were not (controls), with a weighted response rate of 50%. Administrative data, not subject to self-report or survey response bias, included hospital discharge data, credit reports, mortality records, and Medicaid administrative data. To account for imperfect program take-up, we produced two types of equations for each outcome measure: 1) Ordinary Least Squares (OLS) modeled the difference between treatment and control groups, preserving the integrity of randomization; and 2) an instrumental variable approach, Two-stage Least Squares (2SLS) used the difference in insurance coverage between the two groups attributable to the lottery (the “first-stage”) to estimate the treatment effect if every person who won the lottery had gained coverage.
Results: About one year after enrollment we found that insurance coverage is associated with improved access and quality of health care, reduced financial strain, and big improvements in self-reported physical and mental health. Access: Medicaid coverage increases the likelihood of using outpatient care by 35%, prescription drugs by 15%, and being admitted to the hospital by 30% but does not initially appear to have an effect on use of emergency rooms. This increased utilization translates into about a 25% increase in annual health care spending. Quality: Medicaid increases the probability individuals report having a regular source of primary care by 70% and the likelihood of having a particular doctor they see by 55%. Insurance also increases the use of preventive care, such as mammograms (60%) and cholesterol monitoring (20%). Financial Strain: Medicaid coverage decreases the probability of having to borrow money or skip paying other bills to pay for health care by 40%, and the probability of having an unpaid medical bill sent to a collection agency by 25%. Health: Medicaid coverage increases the probability that people report themselves in good to excellent health (compared with fair or poor health) by 25% and increases the probability of not being depressed by 10%.
Conclusions and Implications: Our initial findings suggest that public coverage expansions are more cost-effective than previous non-experimental studies have indicated. Gaining insurance had a significant positive impact on the lives of individuals across all measurement domains.