Abstract

This study aims to estimate the impact of a potential Medicaid expansion on Texas hospitals. The Affordable Care Act (ACA) Medicaid expansion increased access to health care and improved health outcomes. Still, several states, including Texas, have not adopted the expansion. This is a retrospective quasi-experimental study. We obtained inpatient data containing discharges from Texas hospitals between 2010 and 2017 from the Texas Department of State Health Services. Texas hospitals receive a significant number of patients from the adjacent states. We use a difference-in-differences methodology, where the patients from the neighboring states that expanded Medicaid in 2014 are the treatment group, and those that reside in Texas are the control group. The outcome variables are the payer mix and the cost of treatment, proxied by Diagnoses Related Group (DRG) weights assigned by the Centers for Medicare and Medicaid Services (CMS). The Medicaid expansion is associated with 4.15% lower costs of treatment among the patients from the expansion states (P < .01). Also, the uninsured rate decreased by 4.7 percentage points (from 11.3%, P < .01), while the share of Medicaid patients increased by 10.9 percentage points (from 30.7%, P < .01). There are no significant changes in the share of privately insured or Medicare patients. Texas hospitals can benefit significantly from Medicaid expansion due to reductions in average treatment costs and the share of the uninsured.

Description

Creative Commons Non Commercial CC BY-NC: This article is distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 License (https://creativecommons.org/licenses/by-nc/4.0/) which permits non-commercial use, reproduction and distribution of the work without further permission provided the original work is attributed as specified on the SAGE and Open Access pages (https://us.sagepub.com/en-us/nam/open-access-at-sage).

Publisher

SAGE

Date of publication

9-2022

Language

english

Persistent identifier

http://hdl.handle.net/10950/4062

Document Type

Article

Included in

Economics Commons

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