WILLIAMS COLLEGE LIBRARIES Your unpublished thesis, submitted for a degree at Williams College and administered by the Williams College Libraries, will be made available for research use You may, through this form, provide instructions regarding copyright, access, dissemination and reproduction of your thesis _ The faculty advisor to the student writing the thesis wishes to claim joint authorship in this work In each section, please check the ONE statement that reflects your wishes I PUBLICATION AND QUOTATION: LITERARY PROPERTY RIGHTS A student author automatically owns the copyright to his/her work, whether or not a copyright symbol and date are placed on the piece The duration of U.S copyright on a manuscript and Williams theses are considered manuscripts is the life of the author plus 70 years _ I/we not choose to retain literary property rights to the thesis, and I wish to assign them immediately to Williams College Selecting this option will assign copyright to the College This in no \vay precludes a student author from later publishing his/her work; the student would, however, need to contact the Archives for a permission form The Archives would be free in this case to also grant perml',slcm to another researcher to publish small sections from the thesis Rarely would there be any reason for the Archives to gram permission to another party to publish the thesis in its entirely; if such a situation arose, the Archives would be in touch with the author to let them know that such a request had been made _I/we wish to retain literary property rights to the thesis for a period of three years, at which time the literary property rights shall be assigned to Williams College Selecting this option gi ves the author a few years to make exclusi ve use of the thesis in up-coming projects: articles, later research, etc , ,/I/we wish to retain literary property rights to the thesis for a period of 1-7 years, or until my death, whichever is the later, at which time the literary property rights shall be assigned to Williams College Selecting this option allows the author great flexibility in extending or shortening the time of his/her automatic copyright period Some students are interested in using their thesis in graduate school work In this case it would make sense for them to enter a number such as ' l O i n the blank, and line out the words 'or until my death, whichever is the later,' In any event it is easier for the Archives to administer copyright on a manuscript if the period ends with the individual's death our staff won't have to search for estate executors in this case but this is entirely up to each student II ACCESS The Williams College Libraries are investigating the posting of theses online, as well as their retention in hardcopy ~illiams College is granted permi~sion to maintain and provide access to my thesis in hardcopy and via the Web both on and off campus Selecting this option allows researchers around the world to access the digital version of your work Williams College is granted permission to maintain and provide access to my thesis in hardcopy and via the Web for on-campus use only Selecting this network only _ a]]ows access to the version of your work from the on-campus The thesis is to be maintained and made available in hardcopy form only Selecting this option allows access to your work only from the hardcopy you submit Such access pertains to the of your work including any media that it comprises or includes III COPYING AND DISSEMINATION Because theses are listed on FRA.~CIS, the Libraries receive numerous requests every year for copies of works If/when a hardcopy thesis is duplicated for a researcher, a copy of the release form always accompanies the copy Any digital version of your thesis will include the release form ~Pies of the thesis may be provided to any researcher Selecting this allows any researcher to request a copy from the Williams College Libraries or to make one from an electronic version _ Copying of the thesis is restricted for _ any researcher years, at which time copies may be provided to This option allows the author to set a time limit on restrictions During this period an electronic version of thesis vvili be protected against duplication Copying of the thesis or portions thereof, except as needed to maintain an adequate number of research copies available in the Williams College Libraries, is expressly prohibited The electronic version of the thesis will be protected against duplication Selecting this option allows no reproductions to be made for researchers The electronic version of the thesis will be protected against duplication This does not dis-allow researchers from reading/viewing the work in either hardcopy or digital form Signed (student author) _ Signatures Removed Signed (faculty advisor)_ Thesis title +-\ E ';Ll\-\ I j\, S~ Li~ t j (J;' N-J D \-\5:: J.\lru: T~t;:" E F~ T () i= Wt~DI(A( () ELl C-riJ)) Ll1'1 EX?A-i0 S\ ()~~ uN Date S! F? I loti ( Accepted for the Libraries Signature Removed / ::.t.; -,Gb'\,.l '-(ci _I Date accepted _ _ -'S " r'-_· _ 7-1\'02\'-1\ \-tGi\L\'t-\ 0\JlCC\1\L7 HEALTH INSURANCE AND HEALTH: THE EFFECT OF MEDICAID ELIGIBILITY EXPANSIONS ON PARENT HEALTH OUTCOMES by Jessica Beck Sara LaLumia, Advisor A thesis submitted in partial fulfillment of the requirements for the Degree of Bachelor of Arts with Honors in Economics WILLIAMS COLLEGE Williamstown, MA May 19,2008 Abstract This paper uses exogenous variation in Medicaid eligibility laws to evaluate the effect of Medicaid eligibility expansions on the self-reported health of lowincome parents in expansion states between 1994 and 2006 I find that Medicaid eligibility expansions are positively correlated with parental take-up rates although they have no effect on parental health outcomes I measure this relationship for four different parent samples; mothers, parents, poor health parents, and parents with income below 130% of the federal poverty line The insignificant relationship between eligibility expansions and health holds across all specifications except for the sickest parents For this population I find that the eligibility expansions reduce the probability of being in poor health by 0.7 to 0.9 percentage points, or by 35-45% TABLE OF CONTENTS Acknowledgements Introduction Background and Literature Review A Medicaid and Medicaid Eligibility Expansions B Literature Review 11 B.l Eligibility and Insurance Coverage 11 B.2 Eligibility and Health 12 B.3 Measures of Health: Self-Reported Health Status 13 Methodology and Data 15 A Methodology 15 B Data 21 C Sample 25 Results and Discussion 29 A Medicaid Coverage 29 B Health Status 35 C Possible Explanations 39 Conclusions 48 Tables 52 References 64 Appendix 67 Appendix 68 Appendix 71 Acknowledgements This project owes a great deal of debt to the patience and guidance of my friends, family, and professors I would particularly like to thank Professor LaLumia for her excitement, support, and willingness to explore this topic with me INTRODUCTION Despite improvements in public health insurance coverage, in 2006 47 million people below age 65, or about 15.8% of the non-elderly population, were uninsured The majority of this population (79%) is adults below 300% of the federal poverty line (Holahan 2007) Public policy and health care reform activists have long been concerned with improving health insurance coverage At the foundation of these issues is the assumption that offering coverage to the uninsured will improve their health by increasing access to quality medical care Health insurance eligibility expansions, the policy mechanism for improving coverage, are often motivated by the desire to increase medical care utilization and health among the poor However, economists have not conclusively determined if there is a relationship between insurance coverage and health Eligibility expansions can lead to improvements in coverage, but this does not necessarily increase utilization In addition, even if eligibility expands, this does not ensure that the uninsured actually take up insurance coverage There is some reason to believe that extending insurance to the uninsured can improve health Relative to individuals with private insurance or Medicaid, the uninsured population reports less access to primary care and preventive services According to a survey by the Kaiser Association, in 2004 44% of the uninsured did not have a usual source of care In contrast, only 18% of individuals with insurance report lacking a routine care site Additionally, the uninsured are also more likely to delay or forgo care, allowing conditions to get worse; 51 % report not having seen a doctor in the past year Individuals with insurance coverage, through Medicaid or private providers, report higher levels of access and use regardless of provider In contrast to the uninsured, 18% of those with Medicaid and 17% of individuals with private insurance report not having a routine care source and 27% of individuals in both plans report not having seen a doctor in the past year (Holohan 2007) The similarity in these numbers and the sharp contrast between the behaviors of the insured and uninsured suggest that expanding coverage is a viable way to improve access to care, and subsequently, health I test the hypothesis that Medicaid eligibility expansions will improve the health of the newly eligible Economists have previously studied the effect of Medicaid insurance expansion on insurance take-up and coverage The majority of the work in this field is concerned with the effect of expansions on children's health insurance coverage and only a small number of papers focus on the coverage of non-elderly poor adults In studies that focus on adult take-up, Medicaid expansions are believed to have increased coverage among the previously ineligible (Grogger and Aizer (2003)) Additional work that has analyzed the relationship between coverage, access to care, and utilization of care suggest that insurance coverage is positively correlated with each Few studies, however, have actually assessed the relationship between insurance expansion and health and those that use very small and specific samples Despite some conflicting results, most of these studies find small significant effects of insurance on health Using changes in California's Medicaid (Medi-Cal) law, Lurie (1986) finds a small improvement in health for patients at LA clinics More notably, Currie and Gruber ((1996a) (l996b) (1997)) also find small positive effects when measuring the effect of Medicaid expansions on the health of pregnant women, children, and infants Despite these positive findings, it is hard to generalize this research because infants, pregnant women, and patients at LA clinics are arguably quite different from the general population As Levy and Meltzer (2001) suggest, insurance expansions affect "vulnerable populations" who have the most to gain from increased resources The effect of insurance on the health of the general population is less clear In this paper, I add to the small amount of literature that assesses the effect of insurance coverage on health I address the limitations of previous works by using a general sample and a very general measure of health To this, I utilize changes in state Medicaid eligibility requirements that occurred as a result of federal law changes in 1996 During this time, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) separated Medicaid eligibility requirements from welfare eligibility rules Between 1996 and 2001 many states raised their income eligibility cutoffs and expanded coverage to parents of previously eligible children These changes varied in scale and occurred at different times in different states, creating variation in eligibility laws both across and within states I use data from the CPS March Supplement to assess the effect of the 1996 Medicaid eligibility expansions on health status I first measure the effect of the eligibility expansions on insurance coverage and then, unlike previous work, on health My model is consistent with that used by Grogger and Aizer (2003) although I expand it to measure the health of additional samples The March Supplement is an ideal data source because it over samples low-income individuals (those that qualify for Medicaid) and provides in depth information on income, health insurance, and state of residence It also includes some information on health conditions Unlike other authors, I supplement my CPS health data with information from the Integrated Health Interview Series (IHIS) in order to establish that my measure of health is valid and provide additional insight on the health behaviors and conditions of those that use Medicaid This allows me to comprehensively assess the effect of insurance expansions on the health status of the sample population Table The Effect of Medicaid Eligibility Expansions on Medicaid Coverage of Different Parent Populations with Interaction Terms for 1, 2, and 3+ Years After Expansion Medicaid Mothers (1) Treatment Interactl Interact2 I Interact3 State Unemp Parents (2) Coverage Poor Health Parents (3) -0.21 (15.63)** 0.099 (3.45)** 0.078 (3.03)** 0.099 (6.60)** 0.005 (1.00) -0.188 (16.35)** 0.083 (4.51)** 0.067 (2.60)* 0.091 (5.62)** 0.004 (1.03) -0.056 (20.81)** 0.035 (13.05)** -0.009 (15.68)** -0.237 (21.75)** -0.015 (5.67)** 0.084 (4.79)** -0.052 (2.52)* -0.241 (15.41)** 0.109 (2.38)* 0.085 (3.33)** 0.133 (6.14)** -0.0016 (0.26) -0.054 (8.97)** 0.034 (11.99)** -0.007 (7.66)** -0.238 (12.76)** -0.012 (3.09)** 0.041 (1.16) -0.054 (1.21 ) :t\1ale # of Children Age I Married Years ofEdu Black I White 0.032 (12.37)** -0.01 (17.49)** -0.27 (24.74)** -0.019 (5.47)** 0.088 (5.20)** -0.036 (1.83) Parents < 130% FPL (4) -0.179 (12.41)** 0.094 (3.77)** 0.086 (3.04)** 0.096 (5.78)** 0.006 (1.23) -0.058 (23.22)** 0.036 (11.17)** -0.009 (16.08)** -0.242 (22.35)** -0.016 (5.82)** 0.083 (4.74)** -0.054 (2.24)** Observations 37063 53784 21203 50613 R-S uared 0.21 0.18 0.14 0.18 Also included but not shown are controls for post expansion year dummies Cells contain marginal effects of weighted OLS regressions t-statistics are I in parentheses **p