A cornerstone of the Affordable Care Act (ACA) is the reorganization of the individual group market. The ACA institutes guaranteed issue, community rating, and subsidies in order to increase access to coverage in the individual market. Survey data play an important role in evaluating the effect of the ACA on individual market coverage. However, estimates of the size of the individual market, often referred to as "direct purchase coverage," derived from surveys typically exceed counts from administrative records (Abraham et al., 2013). Estimates from the American Community Survey (ACS) are particularly high (Mach and O'Hara, 2011; Abraham et al., 2013). Previous authors have suggested that the excess number of cases identified as having direct purchase coverage in the ACS is partially driven by the large number of direct purchase reports that are accompanied by reports of other plan types (Mach and O'Hara, 2011). Mach and O'Hara suggest that the potential false-positive reports could be caused by confusion among people that only have employer- sponsored insurance or by respondents that are referring to single service plans. Previous work on the Current Population Survey (CPS) suggested that the over-counting of direct purchase could be tied to the Medicaid undercount. Cantor and colleagues (2006) suggest that Medicaid and CHIP beneficiaries enrolled in managed care plans may perceive their coverage as directly purchased from an insurance company because of the extent of their interaction with the managed care company and their familiarity with its name. However, other authors conducting a record-check study of the CPS found that managed care participants tend to be better, not worse, reporters of their Medicaid coverage compared to participants enrolled in fee-for-service plans (Plotzke et al., 2010). Validation studies also indicate that Medicaid recipients enrolled in managed care are more accurate reporters of their coverage than those in fee-for-service Medicaid (Call et al., 2008/2009). The purpose of this brief is to present preliminary analysis of the contribution of Medicaid misreporting in the ACS to estimates of direct purchase coverage.
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