Do our children become healthier and wiser? A study of the effect of Medicaid coverage on school absenteeism

Abstract

Children make up nearly half of Medicaid enrollees. While the impact of Medicaid coverage on the use of medical care has been extensively examined, few studies have addressed the impact of Medicaid on children's health and schooling. This article reports estimates of the effect of Medicaid enrollment on children's school absenteeism. Schooling is a particularly important outcome because it influences children's productivity and earnings as adults. I use panel data from five years of the Medical Expenditure Panel Survey to estimate the impact of Medicaid enrollment on the number of school absences in reduced form and structural equation models. The structural model includes equations for children's medical care use, health status, and school absences. Econometric methods employed include instrumental variable techniques, fixed effects estimation, and coarsened exact matching. I find that children with Medicaid coverage have significantly more doctor visits, doctor visits are significantly associated with better health, and children in better health miss significantly fewer days of school. I conclude that Medicaid enrollment significantly reduces school absences.