Mental Health is Wealth Too: Did the Affordable Care Act Medicaid Expansion Improve Mental Health Outcomes?

The ongoing COVID-19 pandemic has greatly exacerbated mental health, which has long been a growing problem in the United States; poor mental health not only jeopardizes the well-being of Americans but also has severe implications for America’s economy. Not only do mental health conditions have significant costs of treatment, but the absenteeism, presenteeism, early retirement, and mortality stemming from poor mental health also severely impact productivity. One health policy that could alleviate this problem is Medicaid expansion. The Affordable Care Act gave states the choice to expand Medicaid eligibility for individuals with incomes up to 138% of the federal poverty level. The resulting increases in health coverage, utilization, and outcomes have been comprehensively examined by the literature; however, the association of Medicaid expansion with mental health outcomes has only been tangentially explored. This paper uses panel data from the Behavioral Risk Factor Surveillance System, American Community Survey, and Wide-ranging Online Data for Epidemiological Research database to analyze differences in mental health outcomes between expansion and non-expansion states. Utilizing difference-in-differences regression models, I intend to estimate the effects of Medicaid expansion on depression prevalence, suicides, and accidental drug overdose deaths. This study finds that Medicaid expansion was associated with a significant increase in deaths from unintentional overdose and depression prevalence. The link between expansion and suicides is found to be inconclusive. These results hold widespread implications for mental health policy in the United States.