Contemporaneous and Long-Term Effects of Children’s Public Health Insurance Expansions on Supplemental Security Income Participation

Publisher: Journal of Health Economics, vol. 64
Mar 20, 2019
Authors
Michael Levere, Sean Orzol, Lindsey Leininger, and Nancy Early

Key Findings:

  • Increased Medicaid eligibility lowered children’s SSI participation in states without an automatic Medicaid grant with SSI.
  • A 10 percent increase in the share eligible for Medicaid reduced SSI applications by 5 percent and SSI awards by 3 percent.
  • In the long run, increased Medicaid eligibility during childhood reduced young adult SSI participation to some extent.

This study explores the interplay between two important public programs for vulnerable children: Medicaid and the Supplemental Security Income (SSI) program. Children’s public health insurance eligibility increased dramatically during the late 1990s with the launch of the Children’s Health Insurance Program along with concurrent Medicaid expansions. We use a measure of simulated eligibility as an exogenous source of variation in Medicaid generosity to identify the effects of the eligibility expansions on SSI outcomes. Though increases in eligibility for public health insurance did not affect contemporaneous youth SSI applications or awards on average, expansions in coverage significantly decreased both applications and awards in states where SSI recipients did not automatically receive Medicaid. We attribute the difference in findings to the higher transactions costs associated with entering Medicaid via SSI in such states. In the long-term, increased public insurance eligibility during childhood reduces young adult SSI applications to some extent, consistent with recent findings that Medicaid coverage in youth improves adult health and economic outcomes.