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The Effects of the Transition From Medicaid to Medicare on Health Care Use for Adults With Mental Illness

Burns, Marguerite E., PhD; Huskamp, Haiden A., PhD; Smith, Jessica C., MS; Madden, Jeanne M., PhD; Soumerai, Stephen B., ScD

doi: 10.1097/MLR.0000000000000572
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Background: The transition from Medicaid-only to dual Medicare/Medicaid coverage has the potential to reduce financial barriers to health care for patients with serious mental illness through increased coverage or expanded access to clinicians as their reimbursement increases.

Aims: To estimate the effect of dual coverage after Medicaid enrollment during the required waiting period among adults with serious mental illness on health care use, overall and related to mental health and substance use disorders (MHSUD).

Methods: Data include enrollment and claims from Medicaid and Medicare in Missouri and South Carolina, from January 2004 to December 2007. We used an interrupted time-series design to estimate the effect of dual coverage on average use of outpatient, emergency department (ED), and inpatient care/month.

Results: After 12 months of dual coverage, the probability of outpatient care use increased in both states from 4% to 9%. In Missouri, the mean probability and frequency of ED visits, total and MHSUD related, increased by 21%–32%; the probability of all-cause and MHSUD-related inpatient admissions increased by 10% and 19%, respectively. In South Carolina, the mean probability of any inpatient admission increased by 27% and of any MHSUD-related inpatient admission by 42%.

Discussion: The increase in use of outpatient care is consistent with the expected increase in coverage of, and payment for, outpatient services under dual coverage relative to Medicaid-only. Sustained increases in ED and inpatient admissions raise questions regarding the complexity of obtaining care under 2 programs, pent-up demand among beneficiaries pretransition, and the complementarity of outpatient and inpatient service use.

*Department of Population Health Sciences, University of Wisconsin—Madison, Madison, WI

Department of Health Care Policy, Harvard Medical School, Boston, MA

Department of Pharmacy and Health Systems Sciences, School of Pharmacy, Northeastern University

§Department of Population Medicine, Harvard Medical School, Harvard Pilgrim Health Care Institute, Boston, MA

Supported by the National Institute of Mental Health (K01 MH 092338), the Agency for Healthcare Research and Quality (R01 HS018577), and the sponsorship of the Department of Population Medicine at Harvard Medical School, where M.E.B. began this work.

Earlier versions of this paper were presented at the American Society of Health Economists Biennial Conference at the University of Southern California, June 23, 2014 and the Academy Health Disability Research Interest Group Meeting in Minneapolis, MN, on June 13, 2015.

The authors declare no conflict of interest.

Reprints: Marguerite E. Burns, PhD, Department of Population Health Sciences, University of Wisconsin—Madison, 610 N. Walnut St, Room 760A, Madison, WI 53726. E-mail:

Copyright © 2016 Wolters Kluwer Health, Inc. All rights reserved.