U.S. States That Embraced Healthcare Reform Are Seeing Less Debt Sent to Collection Agencies
As long as their state embraced the Medicaid expansion.
Luke Kawa
June 7, 2016 — 10:18 AM EDT - Bloomberg
Early evidence suggests that the Affordable Care Act is working — at least in
one important respect, according to researchers at the Federal Reserve Bank of
New York.
Analysts Nicole Dussault, Maxim Pinkovskiy, and Basit Zafar state that
the primary purpose of this law "is not to protect our health per se, but to
protect our finances." And they've found a big difference between
indebtedness trends in states that embraced the Medicaid expansion versus the
ones that did not.
The analysts reason that the average amount of debt sent to collections
agencies would tend to rise in the event that people without insurance required
costly medical attention. Yet, U.S. counties that had a particularly high
uninsured rate prior to the implementation of the Affordable Care Act have seen
the per capita collection balance fall if their state embraced the Medicaid
expansion. If not, the collection balance continued to climb:
This quintile of counties with the highest rates of uninsured saw the
largest improvement in this metric following the Medicaid expansion. "The
paths of these counties diverge after the first quarter of 2015," the analysts
write.
The authors caution that this exercise only offers a partial analysis of the
law's effects, as it focuses solely on possible benefits stemming from health
care reform and does not take into account any of the costs.
"While the full effects of the Affordable Care Act on financial health are
yet to be seen, and while the effects of the ACA — positive or negative —
are not restricted to financial health, we offer suggestive early evidence
that the Medicaid expansion is fulfilling the goal of health insurance:
providing 'peace of mind' by protecting against financial hardship," they
conclude.