Does Medicaid Expansion Expand the Choices of Hospital Care? Lessons Learned Kentucky’s Low-Income Population

Uninsured, low-income adults typically depend on safety net hospitals (SNH) for acute medical care because SNHs and other safety net providers deliver care, regardless of patient’s ability to pay. Under Medicaid expansion via the Affordable Care Act (ACA), many more patients are better able to access the health care system without fear of having to delay or forgo needed care because of costs. As a part of improved access to care in general, patients may also be experiencing improved access to, arguably, ‘higher quality’ care from facilities beyond the traditional health care safety net.

In absence of access to health insurance coverage, non-elderly low-income adults face substantial fiscal constraints and unable to afford many of their health care needs. Such constraints created a reliance on SNHs and similar providers able to absorb the costs associated with uncompensated care. However, coverage gains among the newly insured (e.g. Kentucky’s Medicaid expansion population) could increase demand for certain ‘types’ of hospital care—in particular, care patients perceive as higher quality. That is, by alleviating some of the financial burden associated with health care, expanded Medicaid may allow some low-income patients to be freer to “shop” for their hospital provider of choice and utilize non-SNHs more frequently because of perceptions as a higher quality source of care.

Using Kentucky as a case study to examine potential shifts in hospital choice patterns following Medicaid expansion, we use 2012-2016 emergency department discharge data merged with Hospital Compare, American Hospital Association data, and Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) data to ask:

• Do non-safety net hospitals (SNH) experience increased emergency department (ED) visitation from patients in the expansion’s target population (i.e. residing in ZIP codes in the highest quartile of percent poverty or pre-ACA percent uninsured) relative to their SNH counterparts following Medicaid expansion?
• Did Medicaid expansion in Kentucky expand the choice set of hospitals utilized among the likely expansion population?
• Did Kentucky’s Medicaid expansion increase the likelihood that patient’s in the expansion population increase their utilization of non-SNHs and debatably ‘higher quality’ hospitals for non-emergent hospitalizations?