Did the Medicaid expansion reduce service utilization among the Medicare population?

Abstract

ABSTRACT While a large and growing literature has examined the effects of the Affordable Care Act’s Medicaid expansion on newly eligible Medicaid recipients, relatively few studies have explored whether increased Medicaid service utilization has had any negative spillover effects on the Medicare population. This study uses county-level data on Medicare fee-for-service (FFS) utilization from 2007 to 2018 in conjunction with inverse probability of treatment adjusted difference-in-differences and event study models with a variety of inter-temporal controls and county-level fixed effects. It finds highly significant effects of modest magnitude providing evidence of negative spillovers on the traditional Medicare Fee-for-service (FFS) population. FFS Medicare Beneficiaries in Medicaid expansion states experienced a 1% reduction in Evaluation and Management (E&M) visits, a 2.1% reduction in testing services, collectively reducing their volume of visits across Berenson-Eggers Type of Service (BETOS) categories by 0.7%.