from the Chicago Fed
— Research by Sarah Miller, University of Michigan, Luojia Hu, Federal Reserve Bank of Chicago, Robert Kaestner, University of Chicago, Bhashkar Mazumder, Federal Reserve Bank of Chicago, and Ashley Wong, Northwestern University – Summary by Lisa Camner McKay, economics writer
The Patient Protection and Affordable Care Act of 2010 (ACA) was signed into law with a simple but lofty goal: to give more Americans “the financial security of health insurance.” The fact is, paying medical bills is hard for many Americans – in 2014, nearly 20% had medical debt on their credit reports – but it’s especially challenging for those who lack health insurance because medical care is expensive.
A hospital stay can run north of $15,000,3 while insulin, a drug to treat diabetes, can cost as much as $450 every month.
One of the ways in which the ACA made insurance attainable for more Americans was to change the eligibility for Medicaid, a government program to provide health insurance to low-income Americans, to include all adults ages 18 – 64 whose income was less than 138% of the federal poverty level (in 2019, this came to $35,535 for a family of four). The result was one of the largest expansions of health insurance coverage in 50 years, with approximately 12 million new enrollees in Medicaid through 2015 (Hu et al., 2018). Now that several years have passed since this expansion occurred, it is worth asking: Has financial well-being improved for people who gained insurance as a result of the policy change?
Has financial well-being improved for people who gained insurance as a result of the Affordable Care Act?
This question has motivated Luojia Hu and Bhashkar Mazumder, senior economists at the Federal Reserve Bank of Chicago, who with their co-authors Robert Kaestner, Sarah Miller, and Ashley Wong have used variation in Medicaid expansion to estimate the effect that enrolling in Medicaid has on a variety of financial outcomes. Their results affirm that health insurance does indeed offer financial protection to individuals, most notably by reducing the amount of overdue debt sent to third-party collection agencies.
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Source
http://app.frbcommunications.org/e/er?s=1064&lid=6581 &elqTrackId=08AD58DECE9CCD6D0AA7C3725CC7B839 &elq=ab0470a07c7d42b6b82f2912c945ae04 &elqaid=15811&elqat=1
