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Open Access Publications from the University of California

Reducing Young Adults' Health Care Spending through the ACA Expansion of Dependent Coverage.

  • Author(s): Chen, Jie
  • Vargas-Bustamante, Arturo
  • Novak, Priscilla
  • et al.

OBJECTIVE:To estimate health care expenditure trends among young adults ages 19-25 before and after the 2010 implementation of the Affordable Care Act (ACA) provision that extended eligibility for dependent private health insurance coverage. DATA SOURCES:Nationally representative Medical Expenditure Panel Survey data from 2008 to 2012. STUDY DESIGN:We conducted repeated cross-sectional analyses and employed a difference-in-differences quantile regression model to estimate health care expenditure trends among young adults ages 19-25 (the treatment group) and ages 27-29 (the control group). PRINCIPAL FINDINGS:Our results show that the treatment group had 14 percent lower overall health care expenditures and 21 percent lower out-of-pocket payments compared with the control group in 2011-2012. The overall reduction in health care expenditures among young adults ages 19-25 in years 2011-2012 was more significant at the higher end of the health care expenditure distribution. Young adults ages 19-25 had significantly higher emergency department costs at the 10th percentile in 2011-2012. Differences in the trends of costs of private health insurance and doctor visits are not statistically significant. CONCLUSIONS:Increased health insurance enrollment as a consequence of the ACA provision for dependent coverage has successfully reduced spending and catastrophic expenditures, providing financial protections for young adults.

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