A new study published by the National Bureau of Economic Research demonstrates the Massachusetts experiment with universal health coverage improves several health outcomes. Here’s the abstract of the study.
In 2006, Massachusetts passed health care reform legislation designed to achieve nearly universal coverage through a combination of insurance market reforms, mandates, and subsidies that later served as the model for national health care reform. Using individual-level data from the Behavioral Risk Factor Surveillance System, we provide evidence that health care reform in Massachusetts led to better overall self-assessed health. An assortment of robustness checks and placebo tests support a causal interpretation of the results. We also document improvements in several determinants of overall health, including physical health, mental health, functional limitations, joint disorders, body mass index, and moderate physical activity. The health effects were strongest among women, minorities, near-elderly adults, and those with incomes low enough to qualify for the law’s subsidies. Finally, we use the reform to instrument for health insurance and estimate a sizeable impact of coverage on health. The effects on coverage were strongest for men, non-black minorities, young adults, and those who qualified for the subsidies, while the effects of coverage were strongest for women, blacks, the near-elderly, and middle-to-upper income individuals.
Here’s what the authors say about the generalization of their study to the projections for the Affordable Care Act, derisively labeled “Obama Care” by critics.
The general strategies for obtaining nearly universal coverage in both the Massachusetts and federal laws involved the same three-pronged approach of non-group insurance market reforms, subsidies, and mandates, suggesting that the health effects should be broadly similar. However, the federal legislation included additional cost-cutting measures such as Medicare cuts that could potentially mitigate the gains in health from the coverage expansions. On the other hand, baseline uninsured rates were unusually low in Massachusetts, so the coverage expansions – and corresponding health improvements – from the Affordable Care Act could potentially be greater. Of course, larger coverage expansions may mean higher costs, and costs should be weighed against benefits when evaluating the welfare implications of reform.
The study is a sophisticated analysis, worthy of informing the debate with evidence.
Courtemanche, Charles J. and Zapata, Daniela. (2012). Does Universal Coverage Improve Health? The Massachusetts Experience. National Bureau of Economic Research. Working Paper No. 17893. JEL No. I12,I13,I18. http://papers.nber.org/papers/w17893