Does Health Insurance Save Lives?
Written by Editor   
Monday, August 14, 2017 07:27 AM

Is health insurance really a "life-saver" as the political debate seems to claim? Is there an alternative to consider besides relying upon the "life-saver"?

Multiple groups are synthesizing decades worth of data to answer that question.  A report appearing in the New England Journal of Medicine concluded, “arguing that health insurance doesn’t improve health is simply inconsistent with the evidence.”  Some are claiming that plans to change the current nationalized insurance system will have catastrophic effects, claiming “there will be deaths.”  

But this is a more difficult question than it may appear at first glance. First – who do you compare the uninsured to? What's the control group? If you compare uninsured people to those who get insurance due to disability or through Medicare, you might be stacking the deck against being insured – since that comparison group is a bit sicker than average. In contrast, if you compare uninsured people to people with employer-sponsored insurance, you might make being uninsured look worse than it really is due to the so-called "healthy worker effect." Accounting for these imperfect comparisons requires statistical adjustment, which can often be quite difficult.

Second – not all insurance is the same. The main mechanism by which insurance could save lives is through greater access to care. But not all insurance gives equal access to care.

Finally, if you're talking about mortality, the rates in adults are very low. That means to detect significant differences between uninsured and insured individuals you need a very large study.

What would be scientifically ideal is a randomized trial that took a bunch of uninsured people, gave some of them insurance and left some uninsured.  A study in Oregon looked at roughly 12,000 individuals, half of whom “won” the Medicaid lottery found that the rate of catastrophic expenditures was higher in those who lost the lottery, as was the death rate. The rate of diabetes treatment was higher in the lottery winners, suggesting that having insurance does increase access to care. But the rate of treatment was not 0 in the lottery losers. That's because some who lost the lottery ended up getting insurance through other means, and some, of course, paid their own way.

The best national-level data comes from the NHANES study, which is considered a representative sample of Americans.  This study examined around 9,000 individuals and their death rates over 20 years or so. The risk of death, after accounting for demographics, smoking, alcohol use, BMI, physician-rated health and other factors, found that the relative risk of death was 40% higher in the uninsured individuals.

But what about the Affordable Care Act itself (ACA)? We can’t evaluate the impact of Obamacare on mortality directly, but we can look at Medicaid coverage expansions that occurred in years prior.  Harvard researchers already did in this study and found that New York, Maine, and Arizona all expanded Medicaid prior to the ACA. The authors compared the change in mortality rates in these states before and after expansion with their neighbor states.

They found roughly parallel death rates before Medicaid expansion, and a gradually widening split after Medicaid expansion. The authors figured you'd have to cover 176 adults with Medicaid to save one life per year.

The studies all suggest roughly the same thing – that insurance has a modest, but real, effect on all-cause mortality. Something to the tune of a 20% relative reduction in death compared to being uninsured.  The question really to be considered, however, is how can we ensure that more people have access to healthcare to ensure that the "life-saver" is not so frequently needed?