Panel: Impact of the Affordable Care Act on the Wider Economy
(Health Policy)

Saturday, November 4, 2017: 10:15 AM-11:45 AM
Acapulco (Hyatt Regency Chicago)

*Names in bold indicate Presenter

Panel Organizers:  Maxim Pinkovskiy, Federal Reserve Bank of New York
Panel Chairs:  Rajashri Chakrabarti, Federal Reserve Bank of New York
Discussants:  Atul Gupta, Stanford University and David Molitor, University of Illinois, Urbana-Champaign

Medicaid and Financial Health
Kenneth Brevoort, Consumer Finance Protection Bureau, Martin Hackmann, University of California, Los Angeles and Daniel Grodzicki, Pennsylvania State University

The Effects of Michigan's Medicaid Expansion on Financial Outcomes
Luojia Hu1, Robert Kaestner2, Bhashkar Mazumder1, Sarah Miller3 and Ashley Wong1, (1)Federal Reserve Bank of Chicago, (2)University of California, Riverside, (3)University of Michigan

The Affordable Care Act and the Market for Higher Education
Rajashri Chakrabarti and Maxim Pinkovskiy, Federal Reserve Bank of New York

This panel explores the effects of the Affordable Care Act (ACA) and the Medicaid expansion under the ACA on the broader economy. Each paper leverages novel sources of data, innovative methods, and affords a timely and policy-relevant focus on how a health care plan may have intended and unintended consequences on other parts of the economy.


The panel’s first paper studies the effects of the Medicaid expansion provision of the Affordable Care Act (ACA) on households’ financial health. The findings indicate that ACA led to large financial benefits from a substantial reduction in unpaid medical bills as evidenced by better access to and lower prices of credit. The second paper examines the effect of the Medicaid expansions under the ACA on financial outcomes of individuals in Michigan. Using credit report data for a large sample of individuals, the authors find that the Medicaid expansion significantly reduced balances in collections, delinquencies on all credit accounts and credit card delinquencies.


The third paper in this panel looks at the effect of ACA and the corresponding Medicaid expansions on postsecondary education choices of young Americans.The authors employ a triple-difference strategy comparing counties with different levels of uninsurance pre-ACA and in states with different Medicaid expansion decisions across the country. Results indicate that enrollment in <2-year for-profit colleges increased more between high- and low-uninsurance counties in states that expanded Medicaid relative to states that didn’t, with nearly all the increase took place after the 2012 Supreme Court decision that gave states the right to choose not to expand Medicaid. The final paper in the panel investigates the impact of minimum wage increases on employer-sponsored insurance (ESI). Using a difference-in-differences identification strategy, the authors find that an increase in the state minimum wage significantly reduces the likelihood of ESI coverage for minimum wage workers, and that these results are robust to several checks on assumptions. The authors do not find evidence that ACA Medicaid expansion affects the way ESI reacts to minimum wage increases.

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