As you may have noticed, an internet brawl has broken out over a New England Journal of Medicine study of Oregon Medicaid recipients that has gotten caught up in the larger battle over Medicaid expansion in the states. Jonathan Cohn has already done a better job than I ever could of summarizing what the study finds and what both sides are claiming about it, so go read him first.

The short version is that conservatives are seizing on the finding that recipients showed no significant improvement in health to stiffen the spines of Republican state officials who are considering not opting in to Obamacare’s Medicaid expansion. Liberals, meanwhile, are acknowledging that finding, while also noting that it found Medicaid produced a sharp drop in depression rates and in catastrophic out-of-pocket medical expenditures.

I emailed one of the authors of the study, Amy Finkelstein, a professor of economics at MIT, for her take on the battle. She declined to take sides but said something that’s useful in thinking about this fight:

“The results of our randomized evaluation of Medicaid are mixed. Looking over the first two years, we do not find evidence that Medicaid significantly improves measured physical health. However, we do find that Medicaid substantially reduces rates of depression, and virtually eliminates catastrophic out of pocket medical expenditures. How you interpret these findings depends in large part on what you think is the goal behind Medicaid coverage.”

The last line is key. While it’s true that the finding on physical health may be disappointing to liberals, financial security is intimately bound up with personal health care expenditures, and increased financial security is certainly one of the goals behind Medicaid envisioned by liberals — something we hope will be extended to millions of Americans by the Medicaid expansion. As Cohn  puts it: “historically, financial protection has been a driving force behind government expansions of health insurance.”

Meanwhile, another author of the study, MIT’s Jonathan Gruber (a big proponent of Obamacare), says the mental health improvement — in which depression rates dropped by one-third — should not be underestimated. “This is an astounding finding — that is a huge improvement in mental health,” he told TPM. “I would view this study as somewhat weakening the argument for universal coverage based on health improvements, and greatly strengthening the argument based on financial security and mental well being.”

The larger story here is that a number of GOP-controlled states are still trying to determine whether to opt out of the Medicaid expansion, something that will have significant long term implications as to how well Obamacare works. In a victory for the law, West Virginia announced today that it would opt in.

Unless economic security and improved mental health are suddenly not to be seen as goals of Medicaid, it’s hard to see how this new study does all that much to undercut the case for continuing to expand coverage.


UPDATE: Kevin Drum makes an important point. The finding that the study found no significant improvement in physical health turns heavily on the meaning of the word “significant”:

In fact, the study showed fairly substantial improvements in the percentage of patients with depression, high blood pressure, high cholesterol, and high glycated hemoglobin levels (a marker of diabetes). The problem is that the sample size of the study was fairly small, so the results weren’t statistically significant at the 95 percent level.

However, that is far, far different from saying that Medicaid coverage had no effect. It’s true that we can’t say with high confidence that it had an effect, but the most likely result is that it did indeed have an effect…Bottom line: It’s more likely that access to Medicaid did improve health outcomes than that it had zero or negative effects. It’s just that the study was too small to say that with certainty.