ACA health insurance expansions, health professional shortage areas, and the geographic distribution of healthcare providers

Despite the growth in the supply of physicians nationally, there has been a persistent shortage of healthcare providers in areas known as Health Professional Shortage Areas (HPSAs). In this paper, I exploit the large insurance expansion under the Affordable Care Act to study whether the insurance expansion, a demand-side policy, affected the distribution of healthcare providers to geographic HPSAs. Specifically, I examine the per-capita density of non-federal and professionally active primary care physicians, specialist physicians, physician assistants, and advanced practice-registered nurses. I use county-level data from 2010 to 2019 and difference-in-differences and event-study approaches. I find that, despite a large increase in the number of people with insurance, HPSA counties in Medicaid expansion states did not experience a greater growth in primary care physicians than HPSA counties in non-expansion states. However, the density of specialist physicians and mid-level providers including physician assistants and advanced practice-registered nurses grew by more in expansion HPSA counties relative to non-expansion HPSA counties. Consistent with the predictions of the theoretical framework and Newhouse et al. (Bell J Econ 13(2):493–505, 1982), the findings suggest that provider diffusion to shortage areas is more likely to occur when the overall supply of providers increases.