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Article Title

Pent-Up Demand After the Affordable Care Act

Publication Date

8-15-2016

Keywords

health reform, Medicaid

Abstract

Background/Aims: Many state agencies, insurers and providers expected newly insured individuals under the Affordable Care Act (ACA) to inundate the health care market with high demand for health care. High health care utilization among newly insured individuals could indicate higher health risk and/or pent-up demand, defined as initial utilization caused by foregoing or delaying care while uninsured or underinsured. This study provides evidence regarding the relative health risk and pent-up demand for health care among newly insured adults in Medicaid as health reform rolls out.

Methods: We used claims data from a large health insurer to examine the first six months of Medicaid coverage for Minnesota adults 18–64 years old who were newly enrolled between January and March 2014 (n = 4,252). The comparison group was nonelderly Minnesota adults with Medicaid coverage with this insurer in 2013 (n = 21,556). We compared seven types of health care utilization over six months for new and ongoing enrollees: all office visits, new patient office visits, emergency department visits, inpatient stays, diagnostic procedures, all prescriptions filled, and new prescriptions filled. We estimated logit models of the probability of having each type of health care utilization adjusting for age, gender, race/ethnicity and enrollee neighborhood characteristics. We used the coefficient estimates from these models to predict the likelihood of utilizing services as new enrollees compared to ongoing enrollees.

Results: We found lower average predicted rates of health care utilization among new Medicaid enrollees compared to similar ongoing enrollees, with one exception –– new enrollees were more likely to have a new patient visit. In addition, we found that utilization among new enrollees declined during the first six months of coverage in every category except prescriptions filled.

Conclusion: Our analysis of the first six months of Minnesota’s 2014 Medicaid expansion suggests both lower health care needs relative to similar ongoing enrollees and the presence of pent-up demand. This preliminary evidence suggests that both the long-term costs of covering the newly insured and the ongoing pressure on provider supply under the ACA may be lower than expected.

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