"The Impact of Health Insurance Reform in Massachusetts"

One of the major "tea party" talking points during the recent national elections was that recently enacted national health care reforms were going to bankrupt our nation. 

A new study released by the National Bureau of Economic Research (hat tip to Econbrowser) suggests that these concerns may be misplaced finding that health care reforms in Massachusetts (aka Romneycare) have had a number of impacts that were -- when the reform was being debated-- predicted by supporters and scoffed at by opponents. 

Specifically, they find that following the implementation of the new law in Massachusetts...

Coverage through Medicare, which provides insurance for those over age 65, did not change significantly in the elderly population. And, after the reform, the total number of newly insured and their doctors apparently did not demand more inpatient care. In fact, after the Massachusetts reform, treatment intensity -- as measured by length of hospital stays -- decreased by approximately 1 percent.

Use of hospital emergency rooms for routine care also declined after 2006: the reform’s expanded insurance coverage resulted in a 2 percentage point decrease in the fraction of hospital admissions from the emergency room. The reduction in emergency admissions was particularly pronounced among people in low-income areas of the state.

Hospital admissions for treating preventable conditions also fell. The authors find a decrease of 2.7 percentage points in inpatient admissions attributable to preventable conditions.

The authors note that the Massachusetts mandate for individual insurance coverage widened access to outpatient treatment and thus management of preventable conditions. Despite finding other hospital impacts, this study finds no evidence that hospital cost growth increased following the reform.

 Source: http://www.nber.org/digest/nov10/w16012.html, abstracted from the The Impact of Health Care Reform on Hospital and Preventive Care: Evidence from Massachusetts (NBER Working Paper No. 16012), co-authors Jonathan Kolstad and Amanda Kowalski

In as much as new national health reform (aka "Obamacare") has many of the same features as the Massachusetts reforms, this study provides some real reason to believe that national reforms may be able to "bend the cost curve" in a positive direction while expanding access to the uninsured.  This is something many observers (including the newly elected house leadership) have claimed is impossible.