Health insurance coverage and health care utilization: Regression discontinuity evidence from the Affordable Care Act's dependent coverage mandate

Since September 2010, in the United States, the Affordable Care Act (ACA) requires health insurance plans and issuers that offer dependent coverage to make the coverage available until a child reaches the age of 26. Using difference-in-differences type models, studies that investigated the early effects of the ACA find significant increases in health insurance coverage rates among young adults. However, these studies provide mixed results on the effects of the ACA's dependent mandate on health care use. Whle some studies find that the provision is associated with a reduction in out-of-pocket medical expenses but does have a significant impact on health care use, the others find significant effects of the ACA on health care utilization. In this paper, I provide estimates of the relationship between health insurance coverage and health care utilization using data from the Medical Panel Expenditure Survey (MEPS) for the post-ACA period (2011-2013). Using a regression discontinuity (RD) design, I find that approximately 4 percent of young adults lose their health insurance coverage once they turn 26. This effect is highly significant and mainly driven from those who lose their private insurance coverage. I also find that the discrete change in health insurance coverage status at age 26 leads to a 2 percentage point decrease in the probability of office-based physician visits and a 1 percentage point decrease in the probability of dental visits, but does not have significant impact on emergency room or outpatient visits. The results also suggest that the discrete change in health insurance coverage status at age 26 does not have a significant impact on health care expenditures or out-of-pocket costs. These findings are robust to selection of alternative models and samples based on gender, race, employment status, and income.