Working Paper: NBER ID: w15823
Authors: Michael Anderson; Carlos Dobkin; Tal Gross
Abstract: Substantial uncertainty exists regarding the causal effect of health insurance on the utilization of care. Most studies cannot determine whether the large differences in healthcare utilization between the insured and the uninsured are due to insurance status or to other unobserved differences between the two groups. In this paper, we exploit a sharp change in insurance coverage rates that results from young adults "aging out" of their parents' insurance plans to estimate the effect of insurance coverage on the utilization of emergency department (ED) and inpatient services. Using the National Health Interview Survey (NHIS) and a census of emergency department records and hospital discharge records from seven states, we find that aging out results in an abrupt 5 to 8 percentage point reduction in the probability of having health insurance. We find that not having insurance leads to a 40 percent reduction in ED visits and a 61 percent reduction in inpatient hospital admissions. The drop in ED visits and inpatient admissions is due entirely to reductions in the care provided by privately owned hospitals, with particularly large reductions at for profit hospitals. The results imply that expanding health insurance coverage would result in a substantial increase in care provided to currently uninsured individuals.
Keywords: Health Insurance; Utilization of Medical Services; Emergency Department Visits; Inpatient Admissions
JEL Codes: G22; I11; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| health insurance coverage (I13) | medical service utilization (I11) |
| losing health insurance coverage (I13) | medical service utilization (I11) |
| age 19 threshold (C24) | health insurance coverage (I13) |
| health insurance coverage (I13) | contact with healthcare providers (I11) |
| insurance status (I13) | healthcare consumption (I11) |