Panel Paper: The ACA and the Near Elderly: Drawing Evidence from the Incredible Shrinking Discontinuity at Age 65

Saturday, November 9, 2019
I.M Pei Tower: Majestic Level, Majestic Ballroom (Sheraton Denver Downtown)

*Names in bold indicate Presenter

Anuj Gangopadhyaya, Urban Institute

Research Objective: The Affordable Care Act (ACA) disproportionately benefited the near elderly. The ACA: (1) eliminated insurance pricing on pre-existing conditions and implemented an individual mandate which lowered the premiums of the near elderly relative to all other non-elderly adult age groups; (2) eliminated out-of-pocket spending for screening services that are used more frequently by the near-elderly; and (3), expanded Medicaid (in some states) and provided subsidized premiums on the individual exchange for low-income adults, which, all else equal, disproportionately benefit individuals with higher health risks. This study investigates the impact of the ACA on the coverage, healthcare access, and healthcare utilization of near-elderly adults.

Study Design: I implement a difference-in-differences regression discontinuity (DDRD) design to estimate the broad impact of the ACA on the near elderly, building off a large literature that previously exploited the discontinuity in Medicare eligibility at age 65, documenting how this sudden change in Medicare eligibility is associated with a large decrease in uninsured status and increased healthcare access and utilization (e.g. Card et al. 2008). This paper tests for the reversal of this discontinuity; that is, because the ACA altered the healthcare landscape and increased coverage availability among nonelderly adults but introduced much smaller changes in the Medicare program, the discontinuity in coverage and related outcomes that traditionally occurs at age 65 may have decreased. Data from the American Community Survey (ACS) is used to estimate coverage effects. Data from the Behavioral Risk Factors Surveillance System (BRFSS) and the National Health Interview Survey (NHIS) are used to assess the impact of the ACA on near-elderly health care access and utilization.

Population Studied: The analysis sample is restricted to adults between the ages of 55 and 75 from 2010-2017.

Principal Findings: Between 2010-2013, Medicare eligibility at age 65 is associated with a 9.5 percentage point increase. Between 2014-2017, this discontinuity decreased to 5.9 percentage points; this implies that the ACA is associated with a 3.6 percentage point increase in coverage rates for those just under the age cutoff. Coverage gains are larger for non-Hispanic blacks (5.4 percentage points), Hispanics (8.1 percentage points), and individuals with less than a high school degree (5.9 percentage points), and individuals in Medicaid expansion states (3.8 percentage points). The ACA is also associated with increased use in checkups, increased likelihood of having a personal doctor, and decreased likelihood of delaying needed care due to cost for near-elderly adults.

Conclusions: The ACA increased coverage rates, health care utilization rates, and improved access to healthcare for the near-elderly.

Implications for Policy or Practice: This study has implications on the efficacy of the ACA on a focused vulnerable population. By helping to de-emphasize arbitrary discontinuities in healthcare access and use at age 65, the ACA is likely to benefit those who would have delayed needed medical care until they became Medicare eligible. Further, improving patient healthcare access, wellbeing, and health prior to their transition into Medicare may improve the risk pool of Medicare beneficiaries and thereby improve the solvency of the Medicare program.