Medicaid, earnings, and heterogeneous treatment effects: Evidence from the Oregon Health Insurance Experiment (Tidemann, 2021)

Causal Evidence Rating:
Moderate Causal Evidence
Study Type:
Causal Impact Analysis
Outcome Findings:
Earnings and wages: Mod/high-Mixed impacts

Citation
Tidemann, K. (2021). Medicaid, earnings, and heterogeneous treatment effects: Evidence from the Oregon Health Insurance Experiment. The B.E. Journal of Economic Analysis & Policy, 21(4), 1319-1345. https://doi.org/10.1515/bejeap-2020-0270

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There is no conflict of interest.

Highlights

  • The study's objective was to examine the impact of Medicaid health insurance access on annual earnings.
  • The study used a nonexperimental design with survey data collected from the Oregon Health Insurance Experiment (OHIE). The authors used statistical models to compare the earnings outcomes between the treatment and comparison groups.
  • The study found that enrolling in Medicaid was associated with significant increases in earnings for individuals earning less than 100% of the Federal Poverty Line (FPL) and significant decreases in earnings for those earning more than 100% of the FPL.
  • This study receives a moderate evidence rating. This means we are somewhat confident that the estimated effects are attributable to Medicaid expansion, but other factors might also have contributed.

Features of the Intervention

The Oregon Health Plan (OHP) Standard was designed for non-disabled adults aged 18-64 who met specific income eligibility criteria. Participants were not required to pay deductibles or co-pays, but those with incomes exceeding 10% of the Federal Poverty Line (FPL) had to pay a monthly premium of $20. To qualify, households could not earn more than 100% of the FPL, which was $10,400 for individuals and $21,400 for families of four in 2008, and they needed to have financial assets below $2,000. In 2008, Oregon implemented a randomized lottery system to allow residents to enroll in OHP Standard. Each eligible household member could apply, but only one member needed to win for the household to gain access. The state promoted this expansion with a one-month application period, resulting in 89,824 applications submitted. From March to September 2008, 35,169 lottery winners were selected, but only about 30% of these winners ultimately enrolled in the OHP. Enrollment required proof of eligibility at the time of joining and every six months thereafter.

Features of the Study

The study used a nonexperimental design to examine the impact of Medicaid enrollment on annual household earnings, focusing on households that participated in the Oregon Health Insurance Experiment (OHIE) lottery. The author compared households that won the lottery and enrolled in the Oregon Health Plan (OHP) with those that did not win or enroll. Data were collected through baseline surveys from June to November 2008 and follow-up surveys starting in July 2009, involving 16,566 households, with a response rate of about 50%. The treatment and comparison groups were similar in age, race, education, and employment status. The majority of participants were aged 20-50, with comparable proportions of White and Black individuals in both groups. The author estimated earnings across the income distribution and used statistical models to control for household size and survey group.


Findings

Earnings and wages

  • The study found a significant increase in earnings for individuals earning less than 100% of the FPL at the 10th, 20th, and median income percentiles. In contrast, the study found a significant decrease in earnings for individuals earning more than 100% of the FPL and above the 68th income percentile.

Causal Evidence Rating

The quality of causal evidence presented in this report is moderate because it was based on a well-implemented nonexperimental design. This means we are somewhat confident that the estimated effects are attributable to Medicaid access, but other factors might also have contributed.

Reviewed by CLEAR: June 2026

Research Guidelines

Review Protocol: Living Systematic Annual Search and Review Protocol

Review Guidelines: Causal Evidence Guidelines