What Does Expanding Medicaid Do for Low-Income Adults?

The Oregon Health Insurance Experiment—the first to use a randomized approach to analyze the impact of expanding a Medicaid program to low-income adults—yielded surprising findings regarding participants’ physical, mental, and financial well-being.

Dates of Project: May 2008 to November 2011

Description: In 2008, Oregon’s Medicaid agency used a lottery to expand coverage to uninsured low-income adults, as there were more people on the waiting list than there were available slots in the program. The lottery gave researchers a unique opportunity to study the effects of Medicaid using a randomized experiment by comparing outcomes among those who were and were not drawn in the coverage lottery.

The study revealed “a nuanced story that is not in line with some people’s black or white views.”—Co-Principal Investigator, Katherine Baicker, PhD

Researchers from the Office for Oregon Health Policy and Research, Harvard, MIT, the National Bureau of Economic Research, Providence Health & Services, and Portland State University launched the Oregon Health Insurance Experiment, designed to determine how insurance coverage affects people’s use of health care, their health, and their finances.

Key Findings

The team has published its findings to date in several peer-reviewed articles. Key findings include:

  • Medicaid coverage expanded people’s access to and use of health care.
  • Insurance coverage improved adults’ self-reported health and well-being and reduced rates of depression by about 30 percent.
  • Insurance substantially increased their financial security, including reducing the probability of bills being sent to collection and virtually eliminating catastrophic out-of-pocket expenses for enrollees.
  • Medicaid coverage produced no significant improvements in several measures of physical health among these adults two years after coverage began.
  • Total annual medical expenditures were 35 percent higher—or about $1,200 more—for each covered adult than for the control group who didn’t gain access to the program.

Commentators have called this a landmark study of health insurance in the United States.