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Medicaid Expansion Could Have Reduced Medical Divorce, Not Just Uninsurance

Christina Mattina
Medicaid expansion under the Affordable Care Act may have helped reduce the rates of an unromantic phenomenon: medical divorce.
Medicaid expansion under the Affordable Care Act (ACA) may have helped reduce the rates of an unromantic phenomenon: medical divorce.

Prior to the ACA, married couples faced a difficult choice when a spouse was struck by a serious and costly illness. They could spend their combined savings until their assets were low enough to qualify for Medicaid, or get a divorce to separate their finances in hopes of preserving some retirement funds for the healthy partner.

The ACA's Medicaid expansion provision made it easier for people in participating states to qualify for Medicaid and eliminated the maximum asset levels for couples, basing eligibility only on net income. Economic researchers David Slusky, PhD, and Donna Ginther, PhD, then hypothesized that the program’s expansion could be linked to lower divorce rates. Their findings, recently published in a National Bureau of Economic Research working paper, suggested that the new eligibility rules likely did in fact reduce the prevalence of so-called “medical divorces” in Medicaid expansion states.

“Using a difference-in-differences approach on states that did and did not expand Medicaid,” they wrote, “we find that the expansion decreased the prevalence of divorce by 5.6% among those 50-64, strongly suggesting that it reduced medical divorce.”

The working paper was published the day before the release of a National Center for Health Statistics report that estimated insurance coverage rates for Americans in the first 9 months of 2016. According to the National Health Interview Survey, the total number of uninsured Americans has dropped from 48.6 million (16%) in 2010 before the ACA’s implementation to 28.2 million (8.8%) from January to September 2016.

This trend of falling uninsurance rates was particularly pronounced in states that had expanded Medicaid; in those states, the proportion of uninsured adults had been nearly halved since 2013, reaching a low point of 9.3% in the most recent survey period. Smaller improvements were observed in states that had not expanded Medicaid, as the rates of uninsured adults fell from 22.7% in 2013 to 17.5% in the first 9 months of 2016.

Despite the increased insurance coverage and potentially reduced incidence of medical divorce witnessed in states that have expanded Medicaid, the provision’s survival is precarious as GOP lawmakers prepare to repeal and replace the ACA. One proposed solution is to allow states “the flexibility to retain coverage” for those who became insured under the law, as was advocated by Republican Ohio Governor John Kasich in a TIME opinion column.

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