The Impact of Medicaid Policy Change on People with Disabilities

Abstract

In this dissertation, I examine the impact of Medicaid policy change on people with disabilities. To do so, I make use of quasi-experimental methods to evaluate the causal impact of three distinct types of Medicaid policy change. In Chapter 1 (written with Nicole Maestas), we assess the impact of the Affordable Care Act’s Medicaid Expansion on disability benefits enrollment, making use of the longitudinal nature of the Current Population Survey to assess treatment effects on people with the longest standing disabilities. Using a stacked difference-in-difference study design, we find that Medicaid Expansion increased enrollment in Social Security Disability Insurance (SSDI) for people with these disabilities by 18%. Effects were concentrated in those populations most likely to experience “job lock” – the inability to leave one’s employment due to their need for employer-sponsored insurance – prior to expansion, suggesting that Medicaid Expansion’s effect was driven by it serving as a bridge over the 2-year waiting period for Medicare coverage for SSDI enrollees. While Medicaid Managed Care has long been the dominant mechanism through which Medicaid beneficiaries receive their medical care benefits, over the last two decades there has been a vast expansion in the use of Managed Long-Term Services and Supports (MLTSS), which shift risk to private health plans for the management of long-term care. While people with intellectual and developmental disabilities (I/DD) have historically been carved out of such MLTSS programs, recent years have seen states including the I/DD population in the same Managed Care frameworks as other Long-Term Services and Supports (LTSS) populations. In Chapter 2 (written with Seth Hartig), we examine the impact of MLTSS in Iowa and Kansas – two of the first states to implement MLTSS with commercial insurers for LTSS for persons with I/DD – on the employment of Supplemental Security Income (SSI) recipients with I/DD. Using a synthetic control research design, we find strong evidence that Iowa’s MLTSS transition reduced the employment rate of Iowans with I/DD receiving SSI by an average of 1.64 percentage points, a 5.5% reduction relative to the state’s average pre-period level. We find no evidence of an effect in Kansas. We present evidence that the adverse outcomes of MLTSS in Iowa was likely the result of inadequate risk-adjustment of capitated payments and resulting health plan market exits. Over the last two decades, federal policymakers have frequently sought to incentivize states to expand access to Medicaid Home and Community-Based Services (HCBS) with the goal of “re-balancing” LTSS towards the community and away from institutional care. Chapter 3 uses American Community Survey (ACS) data to assess the impact of two LTSS rebalancing programs included within the Affordable Care Act, the Balancing Incentive Program (BIP) and the Community First Choice (CFC) State Plan Option, on the HCBS and institutional workforces. I show that BIP resulted in a 13.24% increase in the size of the HCBS workforce in participating states, while the CFC State Plan Option had no effect. I also present suggestive evidence indicating that the growth in the HCBS workforce caused by BIP is strongest in states subject to the performance targets embedded within the BIP program, suggesting that additional federal funding may be more effective when tied to performance targets for states.