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- Title
By the people, for the people: Local government's representation of voter preferences under the Affordable Care Act.
- Authors
Perez, Victoria; Ross, Justin; Simon, Kosali
- Abstract
Decentralized government is hypothesized to lead public service investments to better align with political preferences across geographical regions, yet there has been limited rigorous testing of this hypothesis. We examine how local public provision of hospital services varied according to political preferences between 2006 and 2016. We use state Medicaid expansion under the Affordable Care Act (ACA) as a source of exogenous variation. Consistent with the motivation for federalism, we find that areas less supportive of the ACA tended to convert the state expansion into lower property taxes with lower public hospital expenditures, whereas, in states that expanded Medicaid, local governments tended to increase public provision of healthcare. Key Takeaways: Local governments participate in the healthcare system as both patient‐care providers and third‐party payers, and account for over 50% of subnational US government expenditures on hospitals and public health services.The 2010 Affordable Care Act (ACA) represented a federal intervention that supplemented existing public health services while also making public health services less expensive to provide.States that expanded Medicaid under the 2010 ACA are treated as exogenous variation to local governments by providing healthcare reimbursements to previously uninsured pools of patients.Differences‐in‐differences demonstrate that local governments treated state Medicaid expansion heterogeneously, with local governments in areas that supported President Obama in the 2008 election increasing hospital expenditures, whereas those in Mitt Romney voting areas tended to maintain expenditures and reduce property tax levies.Findings are consistent with the view that local governments are responsive to the preferences of its voters, even in complex policy environments.
- Subjects
OBAMA, Barack, 1961-; ROMNEY, Mitt, 1947-; PATIENT Protection &; Affordable Care Act; MEDICALLY uninsured persons; VOTERS; LOCAL government; PUBLIC hospitals; PUBLIC investments; PUBLIC spending
- Publication
Public Budgeting & Finance, 2024, Vol 44, Issue 2, p90
- ISSN
0275-1100
- Publication type
Article
- DOI
10.1111/pbaf.12359