Here is a selection from an abstract of a study entitled The Effect of Health Insurance Coverage on the Use of Medical Services by Anderson, Dobkin, and Gross (2012): Substantial uncertainty exists regarding the causal effect of health insurance on the utilization of care. Most studies cannot determine whether the large differences in healthcare utilization between the insured and the uninsured are due to insurance status or to other unobserved differences between the two groups. In this paper, we exploit a sharp change in insurance coverage rates that results from young adults aging out of their parents insurance plans to estimate the effect of insurance coverage on the utilization of emergency department (ED) and inpatient services. [Note: During their study period, children were eligible for insurance coverage through their parents insurance only up to their 23rd birthday, at which point they lost eligibility.] Using the National Health Interview Survey (NHIS) and a census of emergency department records and hospital discharge records from seven states, we find that aging out results in an abrupt 5 to 8 percentage point reduction in the probability of having health insurance. We find that not having insurance leads to a 40 percent reduction in ED visits and a 61 percent reduction in inpatient hospital admissions.

a) This study does not use randomization to assign people to different insurance plans. What two groups are being compared in this study?

b) Identify at least one important methodological difference between the design of this study and the RAND Health Insurance Experiment. Give a hypothetical reason that this difference would bias the results.

c) Are the findings of this study generally consistent with the findings from the Oregon Medicaid Experiment?