Even before its passage, the Affordable Care Act (popularly called Obamacare) was a political lightning rod that led to the Tea Party and the Republicans taking back the House of Representatives in the 2010 elections.
But amid the controversy, which continues until this day, data on what the ACA actually achieved has been scant. A new study shows that one big aspect of the Act, the expansion of Medicaid coverage to millions of more people, has likely saved thousands of lives.
That’s the finding of important new research by Poets&Quants’ Professor of the Week, Sarah Miller of the Stephen M. Ross School of Business at the University of Michigan. The working paper, “Medicaid and Mortality: New Evidence from Linked Survey and Administrative Data,” was co-authored by Sean Altekruse of the National Institutes of Health, Norman Johnson of the U.S. Bureau of the Census, and Laura R. Wherry of the David Geffen School of Medicine at UCLA.
THE REAL IMPACT OF OBAMACARE
Obamacare’s changes to the individual health insurance market have gotten most of the media coverage, but the expansion of Medicaid Congress authorized under the ACA has been far more consequential. It expanded eligibility to all adults in families that had incomes under 138% of the federal poverty level. So far, 36 states and the District of Columbia have expanded Medicaid coverage which increased by 13.6 million more adults as of 2018.
Miller and her co-authors focused on new Medicaid recipients between the ages of 55 and 64, whose annual mortality rate is 1.7%, more than four times higher than that of higher-income people of the same age. Low-income individuals between 55 and 64 experience “higher risks of dying from diabetes (by 787%), cardiovascular disease (552%), and respiratory disease (813%) relative to those in higher-income households,” the researchers note.
To quantify differences in mortality rates the Medicaid expansion made to this group, Miller and her co-authors selected respondents from the authoritative American Community Survey (ACS) to find people who were likely to be included in the ACA Medicaid expansion in the states that allowed it. They linked that to a Census Bureau database that included information on dates of birth and death for people who had a Social Security number, then combined that with data from death certificates that indicate causes of death.
MEDICAID EXPANSION DECREASED MORTALITY RATES
Overall, they found that the Medicaid expansion decreased the mortality rate in the target population by 0.898 percentage point. “This indicates that Medicaid coverage reduces mortality by between 39% and 64%,” Miller and her co-authors observe.
Since 3.7 million individuals living in the states that expanded Medicaid met the researchers’ sample criteria, Miller and her co-authors calculated that approximately 19,200 fewer deaths occurred among this population during the first four years of the Medicaid expansion.
“The Medicaid expansions substantially reduced mortality rates among those who stood to beneﬁt the most,” Miller and her co-authors conclude.
MORE THAN 15,000 DEATHS OCCURRED IN STATES OPTING OUT OF MEDICAID EXPANSION
In addition, they estimated that because there are three million eligible people in that age group living in states that opted out of the Medicaid expansion, “15,600 additional deaths over this four year period…could have been avoided if the states had elected to expand coverage,” the researchers observe.
Miller, 36, is an Assistant Professor of Business Economics and Public Policy at Michigan Ross. Her research focuses on health care economics, including studies with Laura Wherry and other co-authors on the impact of the Medicaid expansion on people’s health and financial well-being. She also does research at the University of Michigan Institute for Healthcare Policy and Innovation.
Miller has taught classes in applied microeconomics, business economics, and health care markets and public policy. She earned a bachelor’s degree in economics from Tulane University and a Ph.D. in the same subject from the University of Illinois. After serving as a Robert Wood Johnson Scholar in Health Policy at Michigan, she began teaching at Ross in 2014 and has been on the faculty ever since.
Howard R. Gold is a contributing writer to Poets&Quants and a columnist at MarketWatch. His writing also has appeared in Forbes, Barron’s, Money and USAToday. Follow him on Twitter @howardrgold.