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Study: PPACA reduces debt for the poor

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The Patient Protection and Affordable Care Act (PPACA) Medicaid expansion program might already be having a noticeable effect on the finances of America’s poor.

A team of five researchers, including three at the Federal Reserve Bank of Chicago, concluded in a paper released earlier this month that getting Medicaid expansion coverage cut the new enrollees’ average non-medical collection balance by about $600 to $1,000. 

For the new enrollees who used the emergency room or were admitted to a hospital, the average balance fell by about $1,364 to $2,272, according to the paper, which was published behind a paywall on the National Bureau of Economic Research (NBER) website.

See also: The Standard Introduces Products Geared for Small Businesses: Disability, Life, Dental, and Retirement

“Health insurance, like any type of insurance, is first and foremost a form of financial protection,” study co-author Robert Kaestner of the University of Illinois at Chicago told the Washington Post in an interview. “It is a real benefit.”

The researchers suggest in their paper that the new Medicaid financial protection could eventually improve enrollees’ finances enough to increase the enrollees’ access to the credit markets.

The researchers conducted the study by using Federal Reserve Bank of New York Consumer Credit Panel/Equifax (CCP) data to see how non-medical debt totals for people ages 19 to 64 changed over time in the states that accepted PPACA Medicaid expansion money and the states that refused PPACA Medicaid expansion money.

The researchers did not have a total average non-medical collection balance for the people analyzed, but they said another study, for people in Oregon, had found a mean non-medical collection balance of $2,740.

See also: Economist: Bad PPACA exchanges cost users dearly

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