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Member Research & Reports

Member Research & Reports

Kentucky: Medicaid Expansion Leads to Drop in Crime

As the health care debate continues on Capitol Hill, a new paper out of the University of Kentucky College of Public Health demonstrates a little-discussed benefit of Medicaid expansion – a drop in crime rates. Dr. Hefei Wen, assistant professor, health management and policy, is the lead author of the paper published in the Journal of Public Economics, which provides the first nationwide county-level and Core-Based Statistical Area (CBSA)-level estimates of the effect of state Medicaid expansions on reducing local crime rates.

[Photo: Dr. Hefei Wen]

Dr. Wen et al. begin from the premise, demonstrated by prior research, that “[s]ubstance use and crime are two of the most intractable social ills facing the United States, and they are inextricably linked. A positive correlation between substance use and crime has been observed in arrestee drug test results and inmate drug reports.” It follows that reducing rates of substance abuse may reduce rates of crime.

The paper demonstrates that a set of state Medicaid expansions preceding the Affordable Care Act (ACA) benefitted people with substance abuse disorders by providing a cost-effective public health approach to crime reduction, partially through increasing their treatment use and reducing their substance use. The investigators examined county-level data from 2001 to 2008, focusing on the crime-reduction effect of state Medicaid expansions through Health Insurance Flexibility and Accountability (HIFA) waivers.

In counties that expanded Medicaid through HIFA waivers, investigators found that that the expansions led to a meaningful reduction in the rates of robbery, aggravated assault and larceny theft. Noting that punitive tactics have historically failed to reduce the use of illicit drugs in the U.S., the researchers conclude that much of the crime-reduction effect of Medicaid expansions likely occurred through increasing substance use disorder treatment rate and reducing substance use prevalence.

This study has clear implications for both public health insurance policy and public safety policy. It provides previously undocumented evidence of significant reductions in crime rates arising from state Medicaid expansions. This has direct relevance to the current health care reform discussions surrounding insurance expansion and ‘mainstreaming’ of substance use disorder treatment. While political sea change may lead to repeal of the ACA, the effect of insurance expansion on social outcomes, such as crime reduction, is still of interest for policy and research.