For immediate release:
Tuesday, January 17, 2006
12:01 a.m. EDT


Christopher Fleming

Are Adults Benefiting From State Health Insurance Expansions?
Public Coverage Grows, But Sometimes At Expense
Of Private Coverage

Researchers Note That The Effect Of Crowding Out And Impact
On Overall Coverage Vary Across States

Bethesda, MD — Public health insurance expansions for low-income adults boosted overall coverage rates for parents in Wisconsin and parents and childless adults in Massachusetts. However, in New Jersey and California, expanded public coverage displaced existing private insurance and produced little evidence of an overall gain in coverage.

So says a new study by Sharon Long, Stephen Zuckerman, and John Graves, published today as a Health Affairs Web Exclusive. Long and Zuckerman are principal research associates at the Urban Institute’s Health Policy Center, where Graves is a research associate.

“Policymakers should not assume that they are only enrolling people who would otherwise have been uninsured,” the researchers write in the study, titled “Are Adults Benefiting from State Coverage Expansions?” They continue, “Some crowding out of private coverage should be expected, although the degree should not be expected to be uniform across states.”In 1997, Massachusetts raised the income threshold for Medicaid eligibility for parents from 86 percent to 133 percent of poverty, and began providing premium assistance support to parents with incomes up to 200 percent of poverty. In addition, the state, which had previously not provided any coverage for nondisabled childless adults, began providing premium assistance to such adults with incomes up to 200 percent of poverty.

In 1999, Wisconsin expanded coverage to parents with incomes up to 185 percent of poverty, an increase from 51 percent. In 2000, New Jersey expanded coverage to parents with incomes up to 200 percent of poverty, up from 41 percent. Also in 2000, California raised the income threshold for parents from 74 percent to 100 percent of poverty.

All four coverage expansions boosted public coverage rates significantly, and private coverage rates held steady in Wisconsin and Massachusetts. Among Massachusetts childless adults, private coverage actually increased, a result the study attributes to the premium assistance offered by the Bay State to those with access to employer coverage.

In New Jersey and California, by contrast, private coverage fell and offset much of the gain on the public side of the ledger. However, the Urban Institute team cautions this does not necessarily mean that those states’ efforts were for naught: “While the crowding out of private coverage does increase the direct costto the public sector, it is likely that at least some share of the private coverage that is replaced by public coverage provides relatively limited benefits or has high premiums, deductibles, and copayments, or both. Crowd-out of inadequate coverage may well yield benefits to families (in terms of better health and financial security) and their communities.”

The study reports “no evidence to suggest that there is enough stigma associated with Medicaid or the State Children’s Health Insurance Program to cause adults to pass up the opportunity to enroll.” The researchers say this may be due in part to the rebranding of these programs as BadgerCare in Wisconsin, FamilyCare in New Jersey, and MassHealth in Massachusetts. “ California wasthe exception, but its Medicaid program has been called Medi-Cal since its inception,” the study observes.

The study can be read at


Health Affairs, published by Project HOPE, is the leading journal of health policy. The peer-reviewed journal appears bimonthly in print with additional online-only papers published weekly as Health Affairs Web Exclusives at


©2006 Project HOPE–The People-to-People Health Foundation, Inc.