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High Uninsured Rates Also Affect the Insured

In a study that will be published in the Journal of Health Economics, N. Meltem Daysal found that high uninsurance not only negatively affects health outcomes for the uninsured, but for the insured as well.

Daysal studied CA heart attack patients between 1999 and 2006, when the state actually saw a 19% reduction in mortality rates for such cases, but found that that there was a significant variation in health outcome improvements; San Francisco and Los Angeles saw decreases of 26% and 30% respectively, but Sacramento only dropped by 13%.  After controlling for basic demographics (age and race) and preexisting risk factors present at admission (history of heart failure, hypertension), he found that cities that treated more uninsured patients saw worse outcomes for insured patients as well.

Daysal describes this effect as “negative spillover,” where hospitals that see a large number of uninsured patients that have higher uncompensated care costs, which take away from resources that could be spent on hiring better doctors, upgrading medical equipment, and making other investments that could improve health outcomes. ¬†Conversely, increasing insurance coverage could have positive spillover effects, possibly improving quality of care for the insured.

This study suggests that by extending coverage to millions of California’s uninsured, the ACA may have additional fringe benefits of improving care by virtue of decreasing uncompensated care costs.

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