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How the Affordable Care Act has improved farmworkers’ health

A new study by SIEPR Faculty Fellow Kwabena Donkor finds that the Affordable Care Act helps agricultural workers get better medical care — and avoid the ER.

More than 2.5 million agricultural workers help maintain the United States’ abundant food supply. They play a vital role in the economy, but their job is hard and often dangerous.

“Everything from the heavy machinery they use to the pesticides and other chemicals that they’re exposed to make it easy to get hurt on the job,” says Kwabena B. Donkor, an assistant professor of marketing at Stanford Graduate School of Business and a faculty fellow at the Stanford Institute for Economic Policy Research (SIEPR).

This low-income, largely immigrant workforce has some of the worst health outcomes in the U.S. Traditionally, farmworkers have had difficulty getting routine preventive care because they’re often itinerant, working for a succession of employers who don’t provide health benefits. “By the time they get to a physician, whatever health problems they’re dealing with are often far along,” Donkor says. Farmworkers who didn’t seek treatment until their symptoms were too severe to ignore often checked into emergency rooms, which are required under federal law to treat anyone, even if they are uninsured.

The Affordable Care Act, the sweeping package of health care reforms signed into law by President Barack Obama in 2010, was designed to bring health insurance and medical care to millions of people who previously could not access them. “If you want a poster child for the sort of person that the ACA is intended to help, that would be a seasonal farmworker,” Donkor says.

Donkor wanted to find out what effect the ACA (also known as Obamacare) has had on the health of this chronically underserved group. As he explains, one of the key unanswered empirical questions about the ACA was how its benefits would affect the behavior of previously uninsured people. Would they visit ERs less because they were receiving preventive care, as the law’s authors had hoped? Or would they go to the ER more often because they would assume that their insurance would cover the cost? Both scenarios were plausible, Donkor notes.

In a study co-written with Jeffrey M. Perloff, a distinguished professor in the Department of Agricultural and Resource Economics at the University of California, Berkeley, Donkor concludes that Obamacare is helping farmworkers in a significant way — while also reducing economic stress on the health care system. The study, recently published in the Journal of the Agricultural and Applied Economics Association, finds that the ACA has not only substantially raised the share of seasonal farmworkers with medical insurance, but it also has increased their use of preventive medical care and decreased their use of hospitals, including emergency care.

Expanding coverage and care

The study looked at 2,265 adult farmworkers from 2010 to 2016. Donkor and Perloff calculated that a quarter of them had preexisting conditions that might have made it difficult for them to afford coverage before health care reform.

“One of the main selling points of the ACA was that before it was passed, insurance companies could charge you a different premium depending on your health status,” Donkor says. “If you had a preexisting condition, you best believe that you were going to have to pay a really high premium.” For low-income farmworkers, that often put coverage — and preventive care — out of reach.

The study found that farmworkers who were eligible for Medicaid, which some states expanded under the ACA, were around 11 percent less likely to be uninsured than ineligible workers. Those eligible to buy insurance on ACA-sponsored exchanges were 5.5 percent less likely to lack insurance. The ACA’s tax penalty for not having coverage reduced the probability of being uninsured by as much as 8.6 percent. (Congress eliminated the penalty in 2019.)

The ACA also reduced the likelihood of a farmworker forgoing medical care. Medicaid-eligible farmworkers were nearly 19 percent less likely to go without care; those eligible for an insurance subsidy under the law were nearly 9 percent less likely. Hospital use, including emergency room visits, decreased by 4.4 percent for Medicaid-eligible farmworkers and 1.5 percent for those eligible for subsidies.

These effects didn’t significantly differ between people with and without preexisting conditions, which suggests that the ACA has benefited farmworkers’ health across the board.

Benefits beyond the fields

Getting an accurate picture of the ACA’s effect on farmworkers was a complex endeavor, which may be why relatively little research had been done on the subject. “There are a lot of moving parts to the ACA,” Donkor says. “And depending upon which state you were in, the law might be applied differently.” The law required states to expand Medicaid coverage to low-income households, yet a 2012 Supreme Court decision allowed some states to opt out of this mandate.

The researchers also had to factor in how the ACA applies to different people. The law requires citizens and legal residents to maintain health insurance but provides subsidies for people who make less than a certain income. “If you have a green card, for example, depending upon how long you’ve been in the U.S., you may not qualify for the premium subsidy,” Donkor explains.

Donkor would like to see additional research that builds upon these findings. For example, he thinks it’s important to take a closer look at farmworkers with preexisting conditions to see how they fare over time. Additionally, he’d like to see whether having access to preventive care reduces the percentage of farmworkers with chronic health issues — potentially a big win for both the workers and the system that takes care of them.

What’s good for farmworkers ultimately benefits all of society, Donkor says. “This has a direct impact on how we manage hospitals,” he says. “If you want to lower the burden on our ERs, this could help. If we provide people with what they need, what we’re paying in taxes might actually be lower.”

This story was originally published Feb. 9 by Stanford GSB Insights.