Will Health Care Reform Reduce Medical Bankruptcies?

Incidentally, what I was looking for when I stumbled upon the chart in the previous post is the data on bankruptcies in Massachusetts.  It's now been four years since Massachusetts passed its health care reform, which seems long enough for reform to have produced a decline in all the medical bankruptcies we are told result from the lack of universal health care in the United States.

Of course, this is somewhat complicated by the intervening financial crisis.  But I figured that graphing bankruptcies in the state of Massachusetts against bankruptcies in the United States as a whole, would give us some indication as to whether Massachusetts is bucking the trend.  Here's what the data look like (quarterly total filings per state*):

Bankruptcy Chart.png

There's some random variance, of course, but nothing that suggests that bankruptcies in Massachusetts have fallen significantly as a result of its new health care program--this even though the percentage of uninsured in the state is now somewhere between 2-5%, depending on which data source you use.

All the usual caveats apply--there's a financial crisis on, and Massachusetts had a lower percentage of uninsured than many other states even before RomneyCare.  It's also possible that the effects haven't shown up yet, or that some other factor in Massachusetts is not only masking them, but also keeping the bankruptcy numbers tightly correlated to the national figures.

Nonetheless, I'm feeling moderately confident about prediction three, though not good about it--it would be nice if bankruptcies were going to go down.  This graph, however, makes it seem like 3-5% was a much more plausible estimate of bankruptcies due to lack of insurance.

Update:  A correspondent asks me (orders, really)  to graph the two lines per capita, and indeed, that presents a better case for Massachusetts on bankruptcies, with one caveat--there was a strangely large jump in the Massachusetts population for the last year I had data, which slightly increases the denominator over the last eighteen months.  That said, take a look:

Thumbnail image for Bankruptcy Two.png

All the same caveats: housing bubble, financial crisis, etc.  Tomorrow I'll try to do it for pre-2006 data, which might offer some better idea of the effects; the 2005 reform is really showing up in those early data, skewing them wildly.   Excluding the bubble/crash, if the ObamaCare enthusiasts were even mostly correct about medical bankruptcies, overall bankruptcies in Massachusetts should eventually fall pretty significantly from their 2004 levels.

. . . and pursuant to another commenter, here's what it looks like in log scale; Massachusetts increases faster from a smaller base, producing slight convergence.

Bankruptcies log scale.png

* Includes business filings because there is some discretion as to whether people file as a business or an individual.  The vast majority (over 90%) of filings are for individuals.