Medicaid expansion not only led to significantly more insured people, but also played a role in improving financial health and reducing medical debts for low-income people, according to a new report.
Researchers at the University of Minnesota analyzed responses to the National Financial Capability Study, which gathers survey data on people’s personal finances, and found that low-income people in expansion states had lower rates of medical debt than those in nonexpansion states and reported more rapid improvement in how they perceive their financial situations.
The analysis included 4,500 people aged 18 to 64 and whose lower income boundary was below 138% of the federal poverty level. Forty-seven percent of those in nonexpansion states and 43% of those in expansion states reported unpaid medical debt at the end of 2012, while 40% of people in nonexpansion states and 30% of those in expansion states said the same at the end of 2015, after the Affordable Care Act had gone into full effect.
People in nonexpansion states were slightly more satisfied with their personal finances in 2012 compared to those in expansion states, rating their satisfaction as a 3.92 out of 10 versus a 3.53. However, by 2015 people in both groups were reporting the same score, a 4.43 out of 10, a more significant increase for those living in expansion states.
The researchers also noted that the uninsured rate in expansion states decreased by a far wider margin than in nonexpansion states, based on what the survey respondents reported. Forty-seven percent of those in nonexpansion states were uninsured in 2012, and 43% of those in expansion states were. By 2015, those numbers had declined to 31% and 16%, respectively.
The findings offer a clear picture that the ACA’s reforms benefit “not just healthcare, but also financial health,” according to the researchers.
“This is not surprising, as financial protection is exactly what health insurance is supposed to provide,” they concluded. “But evidence on the extent to which the ACA Medicaid expansion delivered that benefit has been limited.”
The researchers acknowledge that they did not find statistically significant results in all financial areas, like overdrawn checking accounts, ability to pay bills and credit card problems.