The MA reform even served to reduce UI a bit because the UI benefit amount is based on cash compensation, and the MA reform was encouraging the labor market to tilt a bit away from cash compensation and toward fringe benefits.
[Note that unemployed with UI benefits is not the only form of not working, or even the only form of unemployment (although a large majority of the unemployed since 2007 received UI). In those cases, the two programs above do not apply. Other MassHealth programs might, but I am not yet aware how similar or different MassHealth's programs are from Medicaid programs in the rest of the states.]
Massachusetts also encouraged using the federal tax exclusion for ESI, whereas the ACA tries to wean people off of it. MA told employers: offer tax-excludable ESI -- make employees pay 100% if you want, it doesn't matter if it's affordable or if employees accept your offer -- or else we'll send you the bill for 100% of your employees' uncompensated care. The ESI tax exclusion helps employed people save money, but does nothing for someone not employed. [this para was added Feb 24]
- A fully implemented and enforced ACA will significantly add to distortions on the margin between unemployment and working, whereas the MA reform did not.
- Via its sliding scale subsidies, a fully implemented and enforced ACA will distort other decisions that enhance family incomes, whereas the MA sliding scale subsidies hit a much smaller slice of the MA labor market.
- A fully implemented and enforced ACA will, on a variety of margins, move people out of jobs offering ESI, whereas the MA changes in these margins (if any) were significantly less, and different.
[the above was edited a few hours after posting to reflect comments by John Cochrane -- please don't blame him for mistakes that remain]