For purposes of this diary, let’s leave aside the moral and ethical dimensions of providing more Americans with health care security. Let’s omit any consideration of health: preventive as opposed to emergency care, longer lifespans, more productive citizens. Let’s forget about the fact that the current “system” is a complicated, costly failure that puts America embarrassingly low in the rankings on various measures of national health.

Instead, let’s talk about reform as a stout new weapon in the war on poverty.

A couple of experts have conducted a massive review of family financial data in Massachusetts which, in 2006, enacted a reform measure very similar to the Affordable Care Act. They looked at data from the Federal Reserve Bank of New York Consumer Credit Panel covering the years 1999-2012 in Massachusetts and other New England states. They looked at a bunch of measures of personal financial stress:

…including credit card balances, credit balance past due (over 29 days), fraction of debt past due, third-party collections, credit risk score, and bankruptcy.

And they found that, in Massachusetts…

…the reform significantly improved credit scores, reduced the total amount past due, reduced the fraction of debt past due, and reduced the probability of personal bankruptcy. We find particularly pronounced reductions in the probability of having a large delinquency of over $5,000. These effects tend to be larger among individuals whose credit scores were low at the time of the reform, suggesting that the greatest gains in financial security occurred among those who were already struggling financially. Furthermore, our analysis yields some suggestive evidence that the reform may have also reduced total debt and the amount of third party collections.

The authors point to several ways in which health care reform contributes to financial security:

First and most obviously, coverage expansion directly decreases exposure to the cost of care for the previously uninsured. Second, more generous coverage (e.g., for those previously underinsured) also offers greater protection against health care costs. Finally, these two effects can spillover to others whose coverage didn’t change by reducing the need for them to pitch in when under- or uninsured family members require costly care.

Need further amazement?

Gaze upon the following chart, which shows that the likelihood of personal bankruptcy began to drop immediately after Massachusetts enacted health care reform — and continued to drop through the first two years of the Great Recession!

Health care reform may be a struggle; it wasn’t implemented as well as it should have been; and the way forward is full of obstacles. But here’s one more reason that reform is worth every bit of struggle.

And it’s a big reason we should give Governor Shumlin some credit for pursuing reform, and pushing ahead in spite of all the setbacks. I ding him for his hardline stance on taxes, and for the Dems’ timidity about helping the poor and working poor; but he’s a steadfast advocate for health care reform, and I’m grateful for that.