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The New Health Dialogue

A Blog from New America's Health Policy Program

Medicaid Is Still Not Worse Than Being Uninsured

Published:  July 13, 2011
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Forbes blogger Avik Roy commented during yesterday’s IPAB hearing that “studies show that health outcomes for many Medicaid patients are worse than those who have no insurance at all.” That assertion has been around for a while. Unfortunately for Roy, it’s been frequently refuted, with a new study out of Oregon containing further evidence that patients do, in fact, benefit from Medicaid coverage.

The National Bureau of Economic Research study, released earlier this month, details results from  a study of Oregon’s Medicaid program. Three years ago, the state discovered that it had additional funds for Medicaid and wanted to enroll more people. But there were more eligible recipients than there was money, so the state created a lottery to decide who could apply and who couldn't.   The study, conducted by researchers from Harvard, MIT and other institutions, is the only randomized experiment ever done on the effects of having insurance compared to no insurance.* It compared utilization, health outcomes and self-reported health status, and financial hardship due to medical expenses among people who won the eligibility lottery and those who did not.

One key result: The authors describe an “overwhelming sense from the survey outcomes that individuals feel better about their health.

Individuals who won the lottery also used more medical services, had improved self-assessed physical and mental health, and reduced likelihood of medical debts being sent to a collections agency. While none of the results directly relate to mortality or other measures of actual health (because mortality among the adult population is extremely low, even without insurance), there is a clear benefit to Medicaid in terms of beneficiaries’ general well-being. (Future papers will present more data on traditional measures of health outcomes.)

So much for the claim that Medicaid makes people sicker.

*The RAND Health Insurance Experiment(the only other randomized trial looking at the effects of insurance) examined the effects of different amounts of insurance, using different cost-sharing arrangements, but did not include any participants with no insurance at all.


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