ACA Repeal and Employment Among Working Class People with Disabilities

September 19, 2017

The Congressional GOP is taking one last shot at repealing the ACA. One of the negative consequences of repeal that has gotten little attention is the impact it would have on disabled people’s ability to work.

Before the ACA, non-elderly adults had limited avenues to public health insurance. If they had a severe disability and received Social Security Disability Insurance for two years, they were eligible for Medicare. If they received Supplemental Security Income, a program that limits eligibility to severely disabled people with very low incomes and assets of $2,000 or less, they could qualify for Medicaid. For disabled adults not receiving SSI, the income limits were even stricter. Thus, working even a modest amount could mean the loss of health insurance.

In states that adopted the ACA’s Medicaid expansion, disabled workers are not subject to an asset limit and can earn considerably more without putting their coverage at risk.

Recently published research suggests that removing the barriers to coverage for disabled workers via Medicaid expansion has increased employment of people with disabilities. A team of researchers from the University of Kansas, the Urban Institute, and the University of North Carolina, compared trends in employment rates of non-elderly adults with disabilities who live in expansion and non-expansion states. They found that employment among disabled adults increased in expansion states after Medicaid expansion, while it declined over the same period in states that didn’t expand Medicaid. In 2015, the employment rate of disabled adults in Medicaid expansion states was 20 percent higher in expansion states than in non-expansion states (38 percent compared to 31.9 percent). (The researchers controlled for education, local economic conditions, and other factors.)

Research like this focuses on the short-term effects of health coverage expansion, but research on pre-ACA Medicaid expansions also suggests coverage expansions can lead to increases in employment and reductions in work disabilities over the long term. The most notable body of research here is on long-term effects of Medicaid expansions to children.  For example, Sarah Miller and Laura Wherry find that expanding Medicaid coverage to pregnant women in the 1980s resulted in “lower rates of chronic illnesses and fewer hospital visits for diabetes and obesity during adulthood among cohorts” and increased high school graduation rates. Similarly, Andrew Goodman-Bacon finds that the introduction of Medicaid in the late 1960s led to reductions in child mortality and adult disability rates.

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