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Medicaid Policy Changes in Mental Health Care and Their Effect on Mental Health Outcomes


  • Alison Cuellar
  • Sara Markowitz


In recent years, Medicaid has experienced a dramatic increase in spending on prescription drugs in general and psychotropic medications in particular. The purpose of this study is to examine the effects of increased Medicaid spending on psychotropic drugs on improving the mental health and well-being of participants at the population level. Specifically, we study the effect on outcomes that are strongly correlated with mood disorders, including depression, and Attention Deficit/Hyperactivity disorder, controlling for concomitant increases in Medicaid eligibility thresholds and expansion into managed care for mental health services. Knowledge of the effects of changes in the Medicaid program is crucial to policymakers as they consider implementing and expanding mental health services. Our results show that increased spending on antidepressants and stimulants are associated with improvements in some outcomes, but not in others.

Suggested Citation

  • Alison Cuellar & Sara Markowitz, 2006. "Medicaid Policy Changes in Mental Health Care and Their Effect on Mental Health Outcomes," NBER Working Papers 12232, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:12232
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    References listed on IDEAS

    1. Kristine A. Lykens & Paul A. Jargowsky, 2002. "Medicaid matters: children's health and medicaid eligibility expansions," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 21(2), pages 219-238.
    2. Dahlberg, Matz & Lundin, Douglas, 2005. "Antidepressants and the Suicide Rate: Is There Really a Connection?," Working Paper Series 2005:4, Uppsala University, Department of Economics.
    3. Jens Ludwig & Dave E. Marcotte, 2005. "Anti-depressants, suicide, and drug regulation," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 24(2), pages 249-272.
    4. Cameron,A. Colin & Trivedi,Pravin K., 2008. "Microeconometrics," Cambridge Books, Cambridge University Press, number 9787111235767, March.
    5. Kaestner, Robert & Dubay, Lisa & Kenney, Genevieve, 2005. "Managed care and infant health: an evaluation of Medicaid in the US," Social Science & Medicine, Elsevier, vol. 60(8), pages 1815-1833, April.
    6. Kaestner, R. & Joyce, T. & Racine, A., 2001. "Medicaid eligibility and the incidence of ambulatory care sensitive hospitalizations for children," Social Science & Medicine, Elsevier, vol. 52(2), pages 305-313, January.
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    Cited by:

    1. Andrés, Antonio R. & Halicioglu, Ferda, 2010. "Determinants of suicides in Denmark: Evidence from time series data," Health Policy, Elsevier, vol. 98(2-3), pages 263-269, December.
    2. Dave E. Marcotte & Sara Markowitz, 2011. "A cure for crime? Psycho‐pharmaceuticals and crime trends," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 30(1), pages 29-56, December.
    3. Antonakakis, Nikolaos & Collins, Alan, 2016. "A Suicidal Kuznets Curve?," MPRA Paper 71108, University Library of Munich, Germany.
    4. Currie, Janet & Stabile, Mark & Jones, Lauren, 2014. "Do stimulant medications improve educational and behavioral outcomes for children with ADHD?," Journal of Health Economics, Elsevier, vol. 37(C), pages 58-69.
    5. Andrés, Antonio R. & Halicioglu, Ferda & Yamamura, Eiji, 2011. "Socio-economic determinants of suicide in Japan," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(6), pages 723-731.
    6. O’Flaherty, Brendan & Sethi, Rajiv, 2015. "Urban Crime," Handbook of Regional and Urban Economics, Elsevier.

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    JEL classification:

    • I0 - Health, Education, and Welfare - - General

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