Medicaid Coverage Doesn’t Discourage Employment, New Study Shows

A new National Bureau of Economic Research (NBER) report refutes the claim by some opponents of health reform’s Medicaid expansion that enrolling in Medicaid discourages people from working.

The report strengthens the case for states to adopt the Medicaid expansion, a choice that more states are making.  It also corrects one of the many myths surrounding Medicaid; our recent short paper corrects five others.

The report uses data from the Oregon Health Study, a landmark, ongoing study of the state’s Medicaid program that allows researchers to compare low-income adults selected in a lottery to enroll in a Medicaid expansion to those who remained on a waiting list.

Researchers found no statistically significant difference between the two groups either in the share that had earnings (slightly more than half for both groups) or in the amount of earnings.

The researchers also found that Medicaid enrollment boosted participation in SNAP (formerly food stamps) among eligible people.

The increased SNAP participation reflected helpful state practices to coordinate program enrollment as well as enrollees’ greater awareness of SNAP because of their experience with Medicaid.

The report’s findings add to the other positive outcomes associated with Medicaid enrollment that previous research using the Oregon Health Study has identified.  Low-income adults enrolled in Oregon’s Medicaid expansion are more likely than the uninsured to receive preventive care, and they experience far less financial hardship from out-of-pocket health costs.