The Effects of Medicaid Eligibility on Mental Health Services and Out-of-Pocket Spending for Mental Health Services.

Objective: Millions of low-income Americans will gain health insurance through Medicaid under the Affordable Care Act. This study assesses the impact of previous Medicaid expansions on mental health services utilization and out-of-pocket spending.

Methods: Secondary data from the 1998-2011 Medical Expenditure Panel Survey Household Component merged with National Health Interview Survey and state Medicaid eligibility rules data. Methods: Instrumental variables regression models were used to estimate the impact of expanded Medicaid eligibility on health insurance coverage, mental health services utilization, and out-of-pocket spending for mental health services. Methods: Person-year files were constructed including adults ages 21-64 under 300 percent of the Federal Poverty Level.

Results: Medicaid expansions significantly increased health insurance coverage and reduced out-of-pocket spending on mental health services for low-income adults. Effects of expanded Medicaid eligibility on out-of-pocket spending were strongest for adults with psychological distress. Expanding Medicaid eligibility did not significantly increase the use of mental health services.

Conclusions: Previous Medicaid eligibility expansions did not substantially increase mental health service utilization, but they did reduce out-of-pocket mental health care spending.