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And in the budget talks that we've just been discussing, one of the big programs that comes up often is Medicaid. That's the government's medical insurance program for the poor. In recent months, Republicans have often criticized Medicaid for badly serving its target population.

But as NPR's Julie Rovner reports, a new study finds that Medicaid is making a bigger impact than even some of its supporters claimed.

JULIE ROVNER: Anyone who thinks Medicaid provides good insurance just needs to talk to people who have it, says program critic John Goodman. He's president of the conservative National Center for Policy Analysis.

Mr. JOHN GOODMAN (National Center for Policy Analysis): A Boston cabdriver told me the other day that she had to go through 20 doctors before she could find one who would see her. I said, are you going down the Yellow Pages? She said no, I was going down the list that Medicaid gave me.

ROVNER: Scott Gottleib is a physician who treats Medicaid patients at New York University Hospital. He's also a senior fellow at the conservative American Enterprise Institute.

Dr. SCOTT GOTTLEIB (New York University Hospital): What's happening is, I think, Medicaid patients, their health is suffering because the quality of the insurance is being driven down over time.

ROVNER: In a widely quoted column he wrote for the Wall Street Journal this spring, Gottleib cited a large body of academic work showing Medicaid coverage was lacking.

Dr. GOTTLEIB: These studies show, there's, you know, a large number of studies now that show poorer outcomes for the Medicaid recipients.

ROVNER: Meaning they're sicker than those with other kinds of insurance. Some critics even say having Medicaid is worse than having no insurance at all. But a new study suggests that Medicaid actually has a dramatic and positive effect on the lives of the people it serves. Amy Finkelstein is an economics professor at MIT in Boston and one of the study's lead investigators.

Professor AMY FINKELSTEIN (MIT): We found that people who have Medicaid use more healthcare, have less out of pocket medical expenses and medical debt, and report that they are in better health and overall well-being than similar individuals without insurance.

ROVNER: And despite claims that doctors are more likely to accept patients with no insurance than people with Medicaid, that's not what Finkelstein and her colleagues found.

FINKELSTEIN: We see the chance that you've gotten any outpatient care increases by 35 percent if you have Medicaid, relative to if you have none. The chances that they report having a regular office or clinic for their primary care increases by 70 percent. And the likelihood they report having a particular doctor, you know, a usual doctor that they see increases by 55 percent.

ROVNER: Now, before you chalk this up to just another case of dueling studies, consider this. The study by Finkelstein and colleagues from Harvard, the National Bureau of Economic Research, and the State of Oregon, is the first one of its type in nearly 40 years.

FINKELSTEIN: I think it's literally a once-in-a-lifetime opportunity.

ROVNER: She's excited because until now researchers couldn't ethically design a study that denies health insurance to people. But circumstances in Oregon a couple of years ago provided an ethical way to easily compare the health of people who got Medicaid with those who had no insurance. You see, Oregon decided in 2008 that it only had enough money in its budget to allow 10,000 more adults into Medicaid. But tens of thousands more Oregonians were poor and eligible.

So the state held a Medicaid lottery. Those who won got to apply. Once they got Medicaid, researchers entered these randomly selected people into their study, along with thousands of adults who lost the lottery and remained uninsured. This kind of randomized, controlled study is the gold standard for research. So it would now be possible to answer a question that's been hanging over Medicaid for 40 years: Are people better off on Medicaid or are they sicker because they have Medicaid?

FINKELSTEIN: And certainly in this setting, in Oregon, in our population, there's no evidence that having Medicaid is worse than no insurance. In fact, quite the opposite. It's much better.

ROVNER: Studies that are less rigorous, she says, can produce odd results, leading to claims like those being made by Gottlieb and other Republicans, that having insurance or Medicaid makes you sicker something Finkelstein's study clearly did not find. The study out today is only the first snapshot of the massive Oregon database. Finkelstein says researchers now plan to do personal interviews with 12,000 of these people and perform medical tests to get an even more definitive picture of how having Medicaid compares with being uninsured.

Julie Rovner, NPR News.

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