Friday, June 17, 2016

ACA Boosts Financial Security

Better physical health is not the only potential benefit of the Affordable Care Act, according to a Liberty Street Economics analysis. Financial health also appears to improve when more Americans have health insurance. Using data from the Federal Reserve Bank of New York's Consumer Credit Panel, fed researchers analyzed credit card balances and credit scores by county in states that did and did not expand Medicaid. Their conclusion: the expansion of Medicaid has a led to "average per capita credit card balances declining in the counties most affected by the Medicaid expansion." Credit scores increased the most in those areas as well.

"We offer suggestive early evidence that the Medicaid expansion is fulfilling the goal of health insurance: providing 'peace of mind' by protecting against financial hardship," conclude the researchers, who will continue to investigate these dynamics as more data become available.

Source: Federal Reserve Bank of New York, Liberty Street Economics, Is Health Insurance Good for Your Financial Health?

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