Panel Paper:
Medicaid vs. Marketplace Coverage for Near-Poor Adults: Impact on out-of-Pocket Spending Burdens
*Names in bold indicate Presenter
In states that have chosen not to expand Medicaid, adults with incomes between 100 and 138% of the federal poverty level (FPL) may qualify for tax credits to purchase marketplace plans that involve out-of-pocket (OOP) premiums and cost-sharing. In contrast, if the state had expanded Medicaid and they were enrolled in Medicaid instead, they would face little or no premiums or cost-sharing in most states. To date, no published research has assessed how Medicaid expansion decisions have affected OOP spending levels and resources available to individuals and families in this income group.
Data and Methods
We use data years 2013-2015 from the Current Population Survey (CPS) and state Medicaid expansion decisions as a natural experiment to estimate the impact of access to the Medicaid expansion on OOP health expenses, compared with access to subsidized marketplace coverage. The experience in expansion states allows us to estimate how the OOP spending burdens for families in nonexpansion states would change if the states expanded Medicaid.
The CPS provides a sufficiently large sample of the primary income group of interest and reliable questions on annual OOP spending for health insurance premiums and medical expenses. Because undocumented immigrants are not eligible for Medicaid or Marketplace coverage, we impute documentation status for noncitizens and exclude them from the sample. We exclude earlier years due to the CPS income redesign in 2013.
We use two-part models, where the first part (probit) estimates the probability of having non-zero OOP expenses and the second part (GLM) estimates the change in expenses among those with non-zero expenses.
Results Between 2013 and the 2014-2015 post expansion period, OOP health spending for individuals between 100 and 138% FPL was lower in Medicaid expansion states. Low-income adults eligible for premium tax credits and cost-sharing reductions are more likely to face medical financial burdens compared to similar individuals eligible for Medicaid coverage.
Implications/Discussion These findings are important given the greater flexibility that states may have in shaping their Medicaid programs going forward and proposed changes to other ACA provisions.
