With New Marketplaces Created by the Affordable Care Act, Is It Still Less Expensive to Serve Low-Income People in Medicaid Than in Private Insurance?

This report assesses the cost of Medicaid relative to private insurance in the health insurance landscape under the Affordable Care Act (ACA).

The researchers find that people obtaining insurance through the ACA Marketplaces receive significantly less care in hospital emergency rooms and inpatient settings than Medicaid enrollees. However, they have higher total spending for physician and hospital outpatient visits and emergency room services than Medicaid enrollees, because of their higher expenditures per visit. Though it cannot be definitively concluded that total health care expenditures for Medicaid enrollees were lower than those for Marketplace enrollees during the study period, these findings may help policymakers better understand the total cost of health care.