Providence researchers show value of Medicaid coverage

July 27, 2011
Preliminary results show that improving access to care for these low-income adult enrollees reduces financial strain and improves their sense of health and well-being. The Oregon Health Study team, which also includes researchers from Harvard School of Public Health, Massachusetts Institute of Technology and the National Bureau of Economic Research, has found that expanded access to Medicaid increases the use of health care services.

This is the first randomized and controlled scientific study to evaluate the effects of insuring previously uninsured U.S. residents. “The recent federal health reform law makes a huge investment in public health insurance, including major expansions in coverage for the poor and vulnerable,” says Bill Wright, Ph.D., study author and senior research scientist at CORE. “The Oregon Health Study provides policymakers with the best scientific evidence to date on the costs and benefits of those upcoming expansions.” The study was done with the cooperation of the State of Oregon.

In 2008, some 90,000 low-income and uninsured residents applied to a lottery for 10,000 available openings in the Oregon Health Plan. All applicants were invited to participate in the study, and researchers also collected data from hospital records. The health outcomes of those who were selected were compared to those not chosen for coverage. “This is the first study in which access to health insurance was the only thing that differentiated one group from the other,” says Heidi Allen, Ph.D., a research scientist and study author at CORE. “Individuals who had access to the Oregon Health Plan fared better than those who did not in ways that really matter.

If the question is whether having health insurance is important, the answer is definitively yes.” Based on the first year of this study, people gaining Medicaid coverage increases:
  • The likelihood of using outpatient care by 35 percent, using prescription drugs by 15 percent, and being admitted to the hospital by 30 percent, but does not seem to have an effect on use of emergency departments.
  • The use of recommended preventive care, including mammograms by 60 percent and cholesterol monitoring by 20 percent.
  • Individuals reporting a regular source of primary care by 70 percent and a regular primary care provider by 55 percent.
  • The likelihood that people can pay for their health care without having to borrow money or skipping paying other bills by 40 percent, and not having an unpaid medical bill sent to a collection agency by 25 percent. 
  • The probability that people report themselves in good to excellent health by 25 percent, and not being depressed by 10 percent.

    The full study, “The Oregon Health Insurance Experiment,” was released as working paper 17190, found at www.nber.org.