Panel Paper: The Effect of the Patient Protection and Affordable Care Act Medicaid Expansions on Financial Well-Being

Friday, November 4, 2016 : 2:30 PM
Columbia 9 (Washington Hilton)

*Names in bold indicate Presenter

Robert Kaestner, University of California, Riverside


Luojia Hu

Federal Reserve Bank of Chicago

Robert Kaestner

University of Illinois and NBER

Bhashkar Mazumder

Federal Reserve Bank of Chicago

Sarah Miller

University of Michigan

Ashley Wong

Federal Reserve Bank of Chicago

Abstract: We examine the effect of the Medicaid expansions under the 2010 Patient Protection and Affordable Care Act (ACA) on financial outcomes using credit report data for a large sample of individuals. We employ the synthetic control method (Abadie et al., 2010) to compare individuals living in states that expanded Medicaid to those that did not.

 We find that the Medicaid expansions significantly reduced the number of unpaid bills and the amount of debt sent to third-party collection agencies among those residing in zip codes with the highest share of low income, uninsured individuals. Our estimates imply a reduction in collection balances of around $600 to $1,000 among those who gain Medicaid coverage due to the ACA. Our findings suggest that the ACA Medicaid expansions had important financial impacts beyond health care use.