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July 1, 2014

Healthy Graduation Rates

Virginia’s on-time graduation rate has steadily climbed for the past five years, to 89 percent in 2013 from 82 percent in 2008. That’s good and steady improvement. But what if there was more we could do? 

It turns out there is. National expansion of public health care in the 1980s and 1990s produced long-term educational benefits, according to a recent study from the National Bureau of Economic Research. There’s no reason why closing today’s coverage gap in Virginia could not produce similar benefits.

States that expanded their public health insurance coverage had lower high school dropout rates, increased college attendance, and more bachelor’s degrees, the study showed. A 10 percentage point increase in Medicaid eligibility translated into a 5.2 percent decline in high school dropouts; a 1.1 percent increase in college attendance; and a 3.2 percent increase in students completing bachelor’s degrees.

By closing the coverage gap, Virginia could have similar results because increased Medicaid eligibility leads to improved educational attainment. For example, children who receive Medicaid are healthier than those who remain uninsured, and healthier children often perform better in school.

Children in Virginia are eligible for Medicaid if their household income is up to about $47,700 for a family of four. But for their parents it’s another story. Virginia’s income eligibility rules for parents are among the most restrictive in the country. And that hurts kids because parents who don’t qualify often assume their kids don’t qualify either and do not sign them up. Allowing more parents to qualify would mean health care for more children who already are eligible but not enrolled.

There are other benefits to ending the coverage gap. For example, families with Medicaid are less likely to declare bankruptcy and having health insurance decreases out-of-pocket medical spending and debt, freeing resources that could be used for school supplies, tutors, and other education-related items.

State budget savings, a healthier economy, a healthier workforce, healthier kids, and now healthier educational attainment. The reasons to close the coverage gap in Virginia keep growing.

–Asasi Francois, Research Intern

The Commonwealth Institute

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