Estimating Heterogeneous Takeup and Crowd-Out Responses to Existing Medicaid Income Limits and their Nonmarginal Expansions

Abstract

We use a switching probit model and the income-limit-based structure of Medicaid eligibility for children to estimate treatment effects of nonmarginal Medicaid expansions on Medicaid takeup, private insurance coverage, and crowd-out, as well as crowd-out for those eligible for Medicaid under rules already in place. Many of these estimates are not found in existing work on public insurance and cannot be calculated with the linear probability model used by previous work in this literature. We provide an estimation approach that is straightforward to implement yet yields precise treatment effects.