Do Health Insurance Mandates Spillover to Education? Evidence from Michigan’s Autism Insurance Mandate

Social programs and mandates are usually studied in isolation even though they often interact closely with each other. Given the immense recent changes to health insurance systems, there is much potential for spillover effects to other systems in which health plays a large role. In this study, we examine how health insurance interacts with education, specifically the education of students with disabilities. We present the first analysis in the literature of how a mandate for health insurers to cover therapy for Autism Spectrum Disorder (ASD) up to age 18 affects educational services received by, and test scores of, students with ASD. A key aspect of the mandate is that children covered by Medicaid aged out of benefits quickly (by age 6), leaving them with a far weaker benefit than children covered by private insurance. Since we do not observe insurance status directly, we proxy for private insurance coverage using ineligibility for free/reduced-price lunch (FRPL) and estimate impacts on identification with ASD, special education services, and achievement through a series of difference-in-differences and triple difference models. We find little evidence of an overall shift in ASD identification, but we do find substantial crowd-out of special education services for students with ASD from the mandate. The stronger mandate led to increased mainstreaming of students in general education classrooms and a reduction in special education support services like teacher consultants. Girls in particular are more likely to be mainstreamed. There is little evidence of changes in achievement, which supports our interpretation of the service reductions as crowd-out.