Starting in January 2009, California eliminated its adult Medicaid dental benefits. Medicaid is the main source of dental insurance for the low-income population. While all states are required to provide dental coverage to children in low-income families, it is optional to provide Medicaid dental coverage to non-elderly adults aged 19-64. Now, you are being asked to assess the impact of the 2009 elimination of dental coverage You are provided with the data table below, which shows the average dental care expenditures among low-income adults in California and the neighboring states. Assume that while Medicaid dental coverage remained constant in the neighboring states, these states experienced a stronger and faster economic recovery from the financial crisis of 2007-2009, when compared to California. Avg. Exp $320 $335 State Year California 2006 California 2007 California $340 $320 $310 2008 California 2009 California 2010 $270 $285 $290 Neighbors Neighbors Neighbors Neighbors Neighbors 2006 2007 2008 $305 $315 2009 2010 Given the table, which of the main analytical methods (tools) covered in class could you use to a) evaluate the impact of California's 2009 elimination of adult Medicaid dental coverage? Explain b) Using this method, provide an estimate for the effect of the 2009 coverage elimination on dental care expenditures. Show work. c) What is the key assumption required for your estimate to be valid (no bias)? Do the data support the plausibility of this assumption? Explain. d) Do the circumstances described in the problem narrative support the key assumption? Discuss what impact (if any) this has on interpreting your estimate in part B as the causal effect of the 2009 coverage elimination on dental care expenditures. Starting in January 2009, California eliminated its adult Medicaid dental benefits. Medicaid is the main source of dental insurance for the low-income population. While all states are required to provide dental coverage to children in low-income families, it is optional to provide Medicaid dental coverage to non-elderly adults aged 19-64. Now, you are being asked to assess the impact of the 2009 elimination of dental coverage You are provided with the data table below, which shows the average dental care expenditures among low-income adults in California and the neighboring states. Assume that while Medicaid dental coverage remained constant in the neighboring states, these states experienced a stronger and faster economic recovery from the financial crisis of 2007-2009, when compared to California. Avg. Exp $320 $335 State Year California 2006 California 2007 California $340 $320 $310 2008 California 2009 California 2010 $270 $285 $290 Neighbors Neighbors Neighbors Neighbors Neighbors 2006 2007 2008 $305 $315 2009 2010 Given the table, which of the main analytical methods (tools) covered in class could you use to a) evaluate the impact of California's 2009 elimination of adult Medicaid dental coverage? Explain b) Using this method, provide an estimate for the effect of the 2009 coverage elimination on dental care expenditures. Show work. c) What is the key assumption required for your estimate to be valid (no bias)? Do the data support the plausibility of this assumption? Explain. d) Do the circumstances described in the problem narrative support the key assumption? Discuss what impact (if any) this has on interpreting your estimate in part B as the causal effect of the 2009 coverage elimination on dental care expenditures
