The Value of Medicaid: Interpreting Results from the Oregon Health Insurance Experiment

Amy Finkelstein, Nathaniel Hendren and Erzo Luttmer

No 21308, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We develop a set of frameworks for valuing Medicaid and apply them to welfare analysis of the Oregon Health Insurance Experiment, a Medicaid expansion for low-income, uninsured adults that occurred via random assignment. Our baseline estimates of Medicaid's welfare benefit to recipients per dollar of government spending range from about $0.2 to $0.4, depending on the framework, with at least two-fifths – and as much as four-fifths – of the value of Medicaid coming from a transfer component, as opposed to its ability to move resources across states of the world. In addition, we estimate that Medicaid generates a substantial transfer, of about $0.6 per dollar of government spending, to the providers of implicit insurance for the low-income uninsured. The economic incidence of these transfers is critical for assessing the social value of providing Medicaid to low-income adults relative to alternative redistributive policies.

JEL-codes: H51 I13 (search for similar items in EconPapers)
Date: 2015-06
New Economics Papers: this item is included in nep-hea, nep-ias and nep-lma
Note: AG EH PE
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Citations: View citations in EconPapers (51)

Published as Amy Finkelstein & Nathaniel Hendren & Erzo F. P. Luttmer, 2019. "The Value of Medicaid: Interpreting Results from the Oregon Health Insurance Experiment," Journal of Political Economy, vol 127(6), pages 2836-2874.

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Journal Article: The Value of Medicaid: Interpreting Results from the Oregon Health Insurance Experiment (2019)
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