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How Does Medicaid Expansion Impact Income Support Program Participation and Employment for Different Types of People with Disabilities?
NBER
2023.10.31
Social Security Disability Insurance and Supplemental Security Income, the United States’ two primary disability income support programs, each offer a pathway to public health insurance in addition to cash benefits. This implies that expansions in public health insurance availability, such as the ACA’s Medicaid expansions, may impact disability program participation and employment of people with disabilities. However, prior research has yielded mixed results as to the impact of Medicaid expansion on these outcomes. Using a stacked difference-in-differences design and data from the Current Population Survey, we demonstrate that the ACA’s Medicaid expansions increased SSDI receipt among individuals ages 50-64 with physical, self-care and independent living disabilities, consistent with a “job unlock” mechanism. Exploiting the longitudinal nature of the CPS, we show that treatment effects are heterogeneous and concentrated among persons with ongoing disabilities (as opposed to new disabilities) as reported on the CPS’s 6-question functional impairment sequence. We also show suggestive evidence of a reduction in SSI, but find that it is sensitive to specification and data preparation choices, which we illustrate through comparison with other recent work. Effects on employment are inconclusive. Our findings provide further evidence of work capacity among SSDI beneficiaries.