Oregon Health Study
In 2008, for reasons of cost, Oregon's Medicaid agency accepted 10,000 uninsured low-income adults into its insurance program based on a lottery with 89,824 applicants. In the Oregon Health Study, Newhouse and others tracked the effects on those who were accepted and rejected. They found that health insurance improved peoples' health and lives generally, but they also spent more money on health care.
According to economist Katherine Baicker, the study "put to rest two incorrect arguments."
“The first is that Medicaid doesn’t do anything for people, because it’s bad insurance or because the uninsured have other ways of getting care. The second is that Medicaid coverage saves money” by increasing preventive care, for instance.
“It’s up to society to determine whether it’s worth the cost,” said Baicker.
Read more about this topic: RAND Health Insurance Experiment
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