The Long-Term Effects of Early Life Medicaid Coverage

Abstract

Although the link between the fetal environment and later life health and achievement is well-established, few studies have evaluated the extent to which public policies aimed at improving fetal health can generate benefits that persist into adulthood. In this study, we evaluate how a rapid expansion of prenatal and child health insurance through the Medicaid program affected adult outcomes of individuals born between 1979 and 1993 who gained access to coverage in utero and as children. We conduct this analysis by exploiting state- and cohort-level variation in the timing and generosity of Medicaid expansions using a simulated eligibility instrumental variables model. We find that cohorts whose mothers gained eligibility for prenatal coverage under Medicaid have lower rates of obesity as adults and fewer hospitalizations related to endocrine, nutritional and metabolic diseases, and immunity disorders as adults. We also find that the prenatal expansions increased high school graduation rates among affected cohorts. We find effects of public eligibility in other periods of childhood on self-reported health and hospitalizations later in life, but these effects are smaller in magnitude. Our results indicate that expanding Medicaid prenatal coverage had sizeable long-term benefits for the next generation.

Keywords: health, health insurance, Medicaid

JEL Classification: I13, I18