The Impact of Public Health Insurance on Medical Utilization in a Vulnerable Population: Evidence from COFA Migrants

In March of 2015, the State of Hawaii stopped covering the vast majority of migrants from countries belonging to the Compact of Free Association (COFA) in the state Medicaid program. As a result COFA migrants were required to obtain private insurance in health insurance exchanges established under the Affordable Care Act. Using statewide administrative hospital discharge data, we show that Medicaid-funded hospitalizations and emergency room visits declined in this population by 69% and 42% after the expiration of Medicaid eligibility. Utilization funded by private insurance did increase but not enough to offset the declines in publicly-funded utilization. This resulted in a net decrease in utilization. In addition, we show that uninsured ER visits increased as a consequence of the expiration of Medicaid benefits. Paradoxically, we also find a substantial increase in Medicaid-funded ER visits by infants after the expiration of benefits which is consistent with a substitution of ER visits for ambulatory care for the very young.