The impact of Medicaid expansion on spending and utilization by older low-income Medicare beneficiaries

Abstract

Objective: To examine indirect spillover effects of Affordable Care Act (ACA) Medicaid expansions to working-age adults on health care coverage, spending, and utilization by older low-income Medicare beneficiaries.

Data sources: 2010-2018 Health and Retirement Study survey data linked to annual Medicare beneficiary summary files.

Study design: We estimated individual-level difference-in-differences models of total spending for inpatient, institutional outpatient, physician/professional provider services; inpatient stays, outpatient visits, physician visits; and Medicaid and Part A and B Medicare coverage. We compared changes in outcomes before and after Medicaid expansion in expansion versus nonexpansion states.

Data collection/extraction methods: The sample included low-income respondents aged 69 and older with linked Medicare data, enrolled in full-year traditional Medicare, and residing in the community.

Principal findings: ACA Medicaid expansion was associated with a 9.8 percentage point increase in Medicaid coverage (95% CI: 0.020-0.176), a 4.4 percentage point increase in having any institutional outpatient spending (95% CI: 0.005-0.083), and a positive but statistically insignificant 2.4 percentage point change in Part B enrollment (95% CI: -0.003 to 0.050, p = 0.079).

Conclusions: ACA Medicaid expansion was associated with more institutional outpatient spending among older low-income Medicare beneficiaries. Increased care costs should be weighed against potential benefits from increased realized access to care.

Keywords: Medicaid; Medicare; access/demand/utilization of services; aging/elderly/geriatrics; health policy/politics/law/regulation.

FIGURE 1

Event study estimates of relative changes over time in inpatient spending and utilization associated with Medicaid expansion, 2010–2018. Estimated on 2010–2018 Health and Retirement Study respondents who are aged 69 and older, have Medicare data, have full‐year traditional Medicare enrollment, have income at or below 135% of the federal poverty level, live in the community, and live in states that either expanded Medicaid in 2014 or did not expand Medicaid between 2014 and 2018. Weighted coefficients and 95‐percent confidence intervals shown for EXPANSION × 4 YEARS PRE EXPANSION; EXPANSION × 3 YEARS PRE EXPANSION; EXPANSION × 2 YEARS PRE EXPANSION; EXPANSION × YEAR OF EXPANSION; EXPANSION × 1 YEAR POST EXPANSION; EXPANSION × 2 YEARS POST EXPANSION; EXPANSION × 3 YEARS POST EXPANSION; EXPANSION × 4 YEARS POST EXPANSION. The omitted category is EXPANSION × 1 YEAR PRE EXPANSION. Controls include single year of respondent age, education (less than high school, some college, college or more; the omitted category is high school), sex, race (Black/African American, other race; the omitted category is White), and Hispanic ethnicity (the omitted category is non‐Hispanic), and state and year fixed effects. DV, dependent variable. The p‐values of F‐tests of the joint significance of pre‐trend coefficient estimates are as follows for Figures 1 (A) 0.31; (B) 0.98; (C) 0.18; (D) 0.32.

FIGURE 2

Event study estimates of relative changes over time in outpatient spending and utilization associated with Medicaid expansion, 2010–2018. Estimated on 2010–2018 Health and Retirement Survey respondents who are aged 69 and older, have Medicare data, have full‐year traditional Medicare enrollment, have income at or below 135% of the federal poverty level, live in the community, and live in states that either expanded Medicaid in 2014 or did not expand Medicaid between 2014 and 2018. Weighted coefficients and 95‐percent confidence intervals shown for EXPANSION × 4 YEARS PRE EXPANSION; EXPANSION × 3 YEARS PRE EXPANSION; EXPANSION × 2 YEARS PRE EXPANSION; EXPANSION × YEAR OF EXPANSION; EXPANSION × 1 YEAR POST EXPANSION; EXPANSION × 2 YEARS POST EXPANSION; EXPANSION × 3 YEARS POST EXPANSION; EXPANSION × 4 YEARS POST EXPANSION. The omitted category is EXPANSION × 1 YEAR PRE EXPANSION. Controls include single year of respondent age, education (less than high school, some college, college or more; the omitted category is high school), sex, race (Black/African American, other race; the omitted category is White), and Hispanic ethnicity (the omitted category is non‐Hispanic), and state and year fixed effects. DV, dependent variable. The p‐values of F‐tests of the joint significance of pre‐trend coefficient estimates are as follows for Figure 2 (A) 0.85; (B) 0.81; (C) 0.85; (D) 0.87.

FIGURE A1

Event study of Medicaid enrollment, 2010–2018. Estimated on 2010–2018 Health and Retirement Study respondents who are aged 69 and older, have Medicare data, have full‐year traditional Medicare enrollment, have income at or below 135% of the federal poverty level, live in the community, and live in states that either expanded Medicaid in 2014 or did not expand Medicaid between 2014 and 2018. Weighted coefficients and 95‐percent confidence intervals shown for EXPANSION × 4 YEARS PRE EXPANSION; EXPANSION × 3 YEARS PRE EXPANSION; EXPANSION × 2 YEARS PRE EXPANSION; EXPANSION × YEAR OF EXPANSION; EXPANSION × 1 YEAR POST EXPANSION; EXPANSION × 2 YEARS POST EXPANSION; EXPANSION × 3 YEARS POST EXPANSION; and EXPANSION × 4 YEARS POST EXPANSION The omitted category is EXPANSION × 1 YEAR PRE EXPANSION. Controls include single year of respondent age, education (less than high school, some college, college or more; the omitted category is high school), sex, race (Black, Other Race; the omitted category is White), and Hispanic ethnicity (the omitted category is non‐Hispanic), and state and year fixed effects. The p‐value for individual interaction terms are 0.007 (year 0), p = 0.66 (year 1), 0.36 (year 2), 0.09 (year 3), and 0.06 (year 4). The p‐value of an F‐test of the joint significance of pre‐trend coefficient estimates is 0.55.

FIGURE A2

Event study part B Medicare enrollment, 2010–2018. Estimated on 2010–2018 Health and Retirement Study respondents who are aged 69 and older, have Medicare data, have full‐year traditional Medicare enrollment, have income at or below 135% of the federal poverty level, live in the community, and live in states that either expanded Medicaid in 2014 or did not expand Medicaid between 2014 and 2018. Weighted coefficients and 95‐percent confidence intervals shown for EXPANSION × 4 YEARS PRE EXPANSION; EXPANSION × 3 YEARS PRE EXPANSION; EXPANSION × 2 YEARS PRE EXPANSION; EXPANSION × YEAR OF EXPANSION; EXPANSION × 1 YEAR POST EXPANSION; EXPANSION × 2 YEARS POST EXPANSION; EXPANSION × 3 YEARS POST EXPANSION; and EXPANSION × 4 YEARS POST EXPANSION The omitted category is EXPANSION × 1 YEAR PRE EXPANSION. Controls include single year of respondent age, education (less than high school, some college, college or more; the omitted category is high school), sex, race (Black, Other Race; the omitted category is White), and Hispanic ethnicity (the omitted category is non‐Hispanic), and state and year fixed effects. p‐value for individual interaction terms are 0.30 (year 0), p = 0.34 (year 1), 0.92 (year 2), 0.32 (year 3), and 0.18 (year 4). The p‐value of an F‐test of the joint significance of pre‐trend coefficient estimates is 0.88.