Early impacts of the Affordable Care Act.

• Author: Simon, Kosali
• Position: Research Summaries

My recent research has focused on measuring the ways that the Affordable Care Act (ACA) affects the delivery of health services, labor market outcomes, and population health and well-being. Most of my work relies on quasi-experimental research designs that exploit differences in the ways states have implemented parts of the ACA, or ways that the law affects different sub-populations.

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The ACA is a massive law that overhauls many parts of the U.S. health economy. The insurance expansions at the heart of the legislation only occurred in 2014, and studies of the early effects of these changes are only now starting to emerge. However, other aspects of the law came into play much earlier, and I have focused on those changes. In particular, my coauthors and I have examined the 2010 young-adult provision that requires private insurers to allow dependents to remain on their parents' policies until the age of 26 and have several interesting findings.

First, the effect of the law on young adults' insurance coverage was quite dramatic. Almost immediately, this provision increased parental employer coverage of young adults by more than 40 percent--slightly more than 2 million young adults. This expansion also altered health care utilization, increasing young adults' use of inpatient health care and slightly reducing emergency room use. So far, the young-adult expansion does not appear to have substantially affected labor market outcomes. (1)

My work on the young-adult expansion exploits a quasi-experimental research design. The key idea is that even though this provision was implemented nationally, it only affected 19- to 25-year-olds. To help control for time trends and other sources of bias, my colleagues and I compare the time series of outcomes among the 19- to 25-year-olds with the time series in a comparison group of young adults slightly outside that age range and therefore unaffected by the policy change. This approach rests on the assumption that, absent the policy change, the younger and older adults would have followed similar time trends in outcomes. For most outcomes, the assumption appears plausible based on pre-policy trends tests, and the age-based difference-in-difference comparison is now the standard approach in a sizable literature on the ACA young-adult provision.

Take Up and Crowd Out

In a series of papers with Yaa Akosa Antwi, Aaron Carroll, Bradley Heim, Ithai Lurie, Jie Ma, Asako S. Moriya, and Benjamin D. Sommers, I examine the impacts of the young-adult mandate using both survey and administrative data. In our first paper, we use household survey data to show that the provision proved popular, with parental employer-sponsored insurance among young adults rising quite dramatically from March 2010 to November 2011, leading to large reductions in the number of uninsured. (2) [See Figure 1.] Our estimates suggest that the ACA reduced by about one third the number of uninsured among targeted individuals with parental offers of employer coverage. The high take-up rate of the newly available coverage may be...