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The program contributes to lower dropout rates, more college degrees, higher earnings, emptier jails and thriving economies. In short, the American dream.

The Senate’s new health bill, the Better Care Reconciliation Act, proposes even deeper cuts to Medicaid than the House bill. At risk is a program that provides relatively low-cost care to nearly 75 million Americans — including children, pregnant women, disabled individuals and elderly people in nursing homes.

As physicians, we are dismayed by the prospect of millions of patients losing access to the medical care they need. But what is often lost in the debate about who should have health care and who should pay for it is the larger fact thatMedicaid helps people live healthier, fuller and more productive lives. The unavoidable reality for those trying to dismantle the program is that the health of people is intimately linked to the health of communities, local economies and the nation as a whole.

Medicaid has a number of positive effects for patients and communities that often go unrecognized, including more employment, higher earnings, greater educational attainment and lower incarceration rates.
2015 study analyzed how children eligible for Medicaid fare compared with children who are also poor but are ineligible. Researchers found that children who were eligible had higher earnings, collected less in tax credits, and paid more in taxes for decades to come. The longer they were eligible, the greater the effect. For every year a person had Medicaid, income increased by $250, and by the time children were 28, the government had earned back 14 cents for every dollar invested in the program. Researchers estimated that through greater tax revenue alone, the government would earn back more than half of what it spent — 56 cents on the dollar — by the time these individuals reached 60.

The economic consequences of Medicaid ripple beyond those directly covered by the program. Federal health care funds pay doctors, nurses and hospitals — often the largest employers in a given city — but they also indirectly help local economies. Facilities pay for rent and equipment, and employees and businesses purchase goods such as housing, food and transportation.

report from the Commonwealth Fund this month found that the House’s American Health Care Act would have large negative economic consequences. By 2026, the analysis estimates, nearly 1 million jobs would be lost (725,000 in health care), gross state products would decrease by $93 billion, and business output would decline by $148 billion. Forty-seven states would suffer job losses in the coming decade, with Medicaid expansion states experiencing the biggest declines. Three of the top four losers — Florida, Michigan and Pennsylvania — voted for President Trump.
Medicaid also helps people reach higher levels of education. A 2014 study found that Medicaid eligibility decreases the high school dropout rate by 4%-6% and increases the likelihood of completing a four-year college degree by about 3%. The high school completion effect was strongest for minorities, while the college completion effect was largest for whites.

It’s not clear why Medicaid-eligible students were more likely to do well, but the study did find that Medicaid reduced risky sexual behavior, obesity rates, mental health issues and substance use. It’s also possible that parents of insured children had more disposable income to invest in educational and extracurricular activities.

Medicaid may also be good for the criminal justice system. Expanding it instead of cutting it could lead to reductions in recidivism rates and new entrants into prison, as well as savings for criminal justice and social services budgets.
In Washington state, for example, inmates with mental illness released from prison who received Medicaid were more likely to access community-based services — and were 16% less likely to be detained in the following year.

A program that provided behavioral health treatment to low-income adults with substance use issues resulted in a 17% to 33% decline in arrest rates, and saved the state’s criminal justice system $275 million. And Medicaid-eligible individuals with opioid abuse who have access to methadone maintenance therapy (a form of opioid addiction treatment) are less likely to be arrested.

The traditional arguments for Medicaid rest on a moral obligation to ensure equal access to care. Health care is a right, the argument goes, one that Medicaid helps protect. But Medicaid is also a path to higher education, safer communities and greater economic freedom and mobility — what many call the American dream.

Health and health care do not occur in a vacuum. Cutting Medicaid would hurt people as patients — but also as students, employees and neighbors.

Dhruv Khullar is a physician at New York-Presbyterian Hospital and a researcher at the Weill Cornell Department of Healthcare Policy and Research. Anupam B. Jena is an economist, physician and the Ruth L. Newhouse associate professor of health care policy and medicine at Harvard Medical School. Follow  them on Twitter: @DhruvKhullar and @AnupamBJena

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