The Surprising Side Effect Of Healthcare Expansion

So it's official — healthcare may be good for our life expectancy and the quality of our time spent on earth, but it's not so good for the national bank balance. Contrary to both expert and popular expectation, a newly published Harvard University study has found that expanding healthcare via Medicaid doesn't reduce trips to the emergency room. In fact, according to the study, greater enrollment in healthcare programs leads more overall trips to the emergency room, as well as more visits to the doctor's office.

The idea that wider healthcare access would reduce ER bills has oft been touted as an economic reason to back the Great Healthcare Rollout, a.k.a. the Affordable Care Act. Democrats and Republicans alike have used it to help convince Americans that they really would benefit financially from Obamacare. But, as MIT health economist Jonathan Gruber points out, "that was never the right argument."

Now, a Harvard study published in leading journal Science has revealed what happened when Oregon rolled out Medicaid to low-income residents in 2008. The state used a lottery system to assign healthcare to selected members of the public.

As well as a 40 per cent increase in visits to the emergency room, the scheme also saw a greater number of general hospital and primary care provider visits, and prescription drug use. So it's not just the ER that are busier but all healthcare providers, because when people finally have access to healthcare — guess what! — they use it.

So, now that we've gotten over the fact that we need to invest in our health to improve it, what else does the Oregon experiment show? Well, that Medicaid enrollees have significantly lower rates of depression and were more able to pay their medical bills.

Healthcare reform isn't going to produce startling results fast — but there is still plenty of evidence to suggest widespread access will benefit Americans. Take life expectancy: Since 1970, US life expectancy has increased by just two years, according to the Organization for Economic Co-operation and Development (OECD), a rate below the developing world average.

What's more, some of the reasons for this, says the OECD, relate to a lack of health insurance — namely, that America provides few resources to public health and primary care; that a significant amount of the country’s population is uninsured; and that it has higher rates of poverty and income inequality than most other surveyed countries, as we reported back in December.

So when it comes to health, it looks like we'll protect ourselves by investing in it.