“The first rigorously controlled assessment of the impact of Medicaid” recently revealed that when the poor are provided with medical insurance, “they not only find regular doctors and see doctors more often but they also feel better, are less depressed and are better able to maintain financial stability.”
However, despite the obvious benefits of providing insurance for the poor, recent Pennsylvania legislation mandates a $400 million cut from that state’s welfare budget. Richard P. Weishaupt, senior attorney for Community Legal Services in Philadelphia, told the Pittsburgh Tribune-Review that the bill will “dramatically increase child care co-payments, cut Medicaid benefits, change the rules for welfare-to-work programs to eliminate training and educational programs, and reduce eligibility for benefits.”
The study by the National Bureau of Economic Research is the first to research the effects of insurance coverage on randomly-selected individuals. Previously, studying a population in which some participants are given insurance and some are not would have been impossible as it is “unethical to devise a study that would explicitly deny some people coverage while giving it to others.” However, in 2008, Oregon wanted to expand its Medicaid coverage but could only afford to add 10,000 residents to the program. Nearly 90,000 people applied. The state decided to select who would receive benefits by lottery. Economists studied the quality of life of both those who received and those who did not receive Medicaid in the two years before the state of Oregon came up with the money to offer insurance to those who had not received coverage through the lottery.
The study found that those with Medicaid were 35% more likely to go to a clinic or see a doctor, 15% more likely to use prescription drugs, and 30% more likely to be admitted to a hospital. The likelihood that Medicaid recipients said their health was good or excellent increased by 25% and they were 40% less likely to say that there health had worsened in the last year than those without insurance. Among women in the study, those with Medicaid were 60% more likely to have mammograms, 20% more likely to have their cholesterol checked, 70% more likely to have a particular clinic or office for medical care and 55% more likely to have a personal doctor. The researchers at the National Bureau of Economic Research are now assessing the health effects of insurance for the poor.
However, despite the evidence that providing health insurance to the underprivileged is very beneficial, $400 million is going to be cut from the Pennsylvania Department of Public Welfare budget. Currently, 52.2% of Pennsylvania’s welfare budget is dedicated to Medicaid. Over two million Pennsylvanians receive Medicaid benefits and 2,534,761 individuals receive cash assistance or are beneficiaries of the Supplemental Nutrition Assistance Program (SNAP, previously known as food stamps). All of these state citizens will have their benefits cut without guarantee of legislative oversight or opportunity for public comment, Weishaupt said.
Decreased access to benefits which are proven to improve quality of life will be especially harmful for women. The National Institute for Reproductive Health has found that (PDF):

Women are particularly at risk [for being uninsured], with over 17 million women uninsured. Women often rely on a spouse for health coverage, and should they become widowed or divorced, they are susceptible to losing that insurance. Without insurance, women do not receive preventive care and lack security in maintaining their health.

NIRH also found that women of color, young women, and low-income women are especially at risk of being uninsured. Though unemployed and part-time working women are more likely to be uninsured, the majority of uninsured women are in working families.
To learn about how welfare funds are currently distributed, click here [PDF].