The Presence of Prior-Effects of the Medicaid Expansion on Drug Prescription

OBJECTIVES: The objective of this paper examines how each prescription drug providers in states that implemented the Medicaid expansion in 2014 responded to the expansion compared to providers in non-expansion states. Medicaid beneficiaries have been vulnerable to greater cost and lower quality of healthcare.

METHODS: Pro Publica Data on prescription drug spending Study Design-Utilizing a nationwide doctor-level panel data, the difference-in-differences regression was employed to estimate the effect of the Medicaid expansion on six per-doctor outcomes: (1) the total cost of prescribing drugs, (2) the total number of drug claims not covered by Medicaid, (3) the total number of drug claims for beneficiaries covered by Medicaid, (4) the number of beneficiaries, (5) the number of beneficiaries over age 65, and (6) the percentage of brand-name drugs. Data collection/Extraction-This study adopts a novel sample selection procedure and estimation models to address potential confounders across regions and time.

RESULTS: As with previous studies, (3) the number of claims by beneficiaries covered by Medicaid per doctor increased in expansion states relative to non-expansion states after the Medicaid expansion was implemented in the expansion states. However, per-doctor (1) total cost of drugs, (2) number of claims by beneficiaries not covered by Medicaid, (4) number of young beneficiaries, and (5) number of elderly beneficiaries, drops in expansion states relative to non-expansion states in 2013, prior to implementing the Medicaid expansion.

CONCLUSIONS: The policy in the ACA would have prompted the behavior of physicians a year earlier before the implementation in 2014.