Category: Medicaid

Medicaid on the Oregon Trail

A few days ago, I wrote an article suggesting that an effective post-Obamacare reform would be difficult to bring about as long as anti-Obamacare reformers (especially yours truly) stuck to the simple argument that being on Medicaid is as bad (or even worse) than being uninsured. The reason is that the Medicaid beneficiary does not sign up for a national health plan called Medicaid. Instead, he is increasingly likely to sign up for a managed-care plan that contracts with the state to provide Medicaid benefits.

Readers retorted that the nail in Medicaid’s coffin was driven by the Oregon Medicaid experiment, a randomized, controlled trial (sometimes described as “gold standard” which it could not have been, because it was not double blinded). This blog has agreed that the Oregon Medicaid experiment demonstrated the ineffectiveness of Oregon’s Medicaid expansion. However, I am not sure that leads to a general theory of Medicaid’s overall ineffectiveness.

Government Health Metrics: A Solid B+ Even Though Some Medicaid Patients Cannot Get an Appointment

In accordance with federal law, Colorado hired Health Services Advisory Group (HSAG) to do an on-site review of Denver Health Medicaid Choice plan performance in 2013. Denver Health is one of Colorado’s biggest Medicaid contractors. It runs a hospital, a pharmacy, 9 satellite primary care clinics, 4 dental clinics, and 16 school-based health centers. HSAG’s report on Denver Health’s performance was published in April, 2014. All Medicaid clients with a Denver address are automatically enrolled in Denver Health Medicaid Choice unless they choose another Medicaid option.

Denver Health scored well overall. It met 87 percent of all of the evaluative standards. Paperwork on coverage, utilization management, provider certification, and denial of claims documentation was in near perfect order. According to its annual Strategic Access Report, 99.8 percent of Medicaid members were within 30 miles of a Denver Health clinic and there were 54 bus stops within a quarter of a mile of its clinics. It had direct access to care for members with special needs, 24-hour emergency access, preventive health programs, and numerous “committees, workgroups, staff trainings, and evaluation of metrics regarding provision of interpreters and understanding of culture with respect to health care.”

After Almost One Year, Some Medicaid Applicants Still Not Enrolled

man-in-wheelchairWell, there is progress. In June, we discussed the three million people who were funneled into Medicaid by Obamacare’s exchanges, but had still not been enrolled. As of October, the backlog is down to a few hundred thousand.

California and Tennessee are facing lawsuits from residents who say they have seen long delays for coverage after signing up for Medicaid, the federal-state health program for the low income and disabled. Some say they have been waiting since late 2013.

The delays stem from various technical problems and the sheer volume of Medicaid applications states must process.

Oregon Research Confirms Medicaid Increases ED Use

In 2013, many were surprised to learn that Oregon’s Medicaid expansion did not improve health outcomes. Subsequent research on the same data, published this year, found that low-income, uninsured adults newly covered by Medicaid go to the ER more, not less. As seen in the chart below (reproduced from the article), new Medicaid dependents increased their ED  visits by approximately 40% relative to those who did not enroll. This corroborates what hospitals are starting to admit.

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Source: Straining Emergency Rooms by Expanding Health Insurance from Policy Forum.

Here’s Why States Can’t Make Money by Expanding Medicaid

Obamacare encourages states to expand significantly the number of their residents dependent on Medicaid, the joint state-federal program for low-income households. It significantly increases federal funding for expanding this dependency. However, the Supreme Court has declared that the states do not have to accept this expansion.

So, the Administration and its allies have been reduced to arguing that expanding Medicaid is sort of a profit center for states that do it. The President’s Council of Economic Advisers has enthused about how many jobs would be created if hold-out states just accepted the federal hand-out. (The Robert Wood Johnson Foundation has recently produced a report that beats a similar drum.)

Another Bogus Attack on Wisconsin Medicaid

The Wisconsin Legislative Fiscal Bureau analysis estimates the state is losing about $100 million a year by not expanding its Medicaid eligibility as much as allowed under the Patient Protection and Affordable Care Act (ACA). This mudslinging by Wisconsin Governor Scott Walker’s gubernatorial challenger is disingenuous and ignores the fact that Wisconsin made a better choice by allowing many of its low-income uninsured to access private coverage with federal subsidies.

Over the past several years state legislators have grappled with the pros and cons of Medicaid expansion under the ACA. The carrot dangled in front of state legislators is financial; states that agree to expand Medicaid eligibility to 138 percent of the federal poverty level (FPL) can expect the federal government to reimburse states for most of the cost for newly eligible enrollees. Critics of Medicaid expansion counter that the savings are front-loaded in the early years, whereas state costs begin to rise in later years when it’s too late for states to back out. Whereas the federal government will pay 100 percent of the costs through 2016, the feds begin ratcheting the matching rate down to 90% by 2019.

Medicaid Patients Use the ER Because They Have To, Not Because They Want To

It is well established that Medicaid patients use emergency rooms more than either uninsured or privately insured patients. What has been debated is whether their use of the ER is necessary or unnecessary. Well, it turns out that that depends on how you look at it. Obviously, not many people go to the ER because they enjoy the experience and have nothing better to do. However, medical problems that cause them to go to the ER could often be dealt with in a doctor’s office.

The Medicaid and CHIP Payment and Access Commission (MACPac) has just published a review of articles examining why Medicaid patients frequent the ER so much:

The majority of ED visits by non-elderly Medicaid patients are for urgent symptoms and serious medical problems that require prompt medical attention…

7.2 Million More Americans Dependent on Medicaid since Obamacare Opened

The Center for Medicare & Medicaid Services (CMS) has just released more data corroborating our previous conclusion that Obamacare is mostly an expansion of welfare dependency:

The 48 states reporting both June 2014 enrollment data and data from July-September 2013 report total enrollment in June of over 65 million individuals, and July-September 2013 average enrollment of 58 million. For June 2014, we are reporting growth of 7.2 million compared to July-September 2013…

What is really remarkable is that the government thinks this is something to be proud of. It is a far greater number than the increase in those enrolled in individual plans (even with Obamacare subsidies), and will impose a significant drag on employment growth as long as Obamacare’s Medicaid expansion persists.

Medicaid’s Perverse Financing Merry-Go-Round

health-insuranceMedicaid, which provides health-related welfare benefits to low-income individuals, is jointly financed by the federal and state governments. Before Obamacare, the split was 50/50 for rich states, but low-income states got more dollars. This mechanism is called the Federal Medicaid Assistance Percentage (FMAP). So, if California spent $50 on Medicaid, the federal taxpayer would chip in $50. However, for West Virginia, the split is 28.65/71.35. That is, for every hundred dollars spent on Medicaid, only $28.65 is spent by the state, and $71.35 comes from federal taxpayers. These dollars are not appropriated by Congress: They just roll out on auto-pilot, as calculated by the FMAP.

Obamacare Enrollment is Mostly Medicaid Expansion

The Urban Institute produces a quarterly survey of Obamacare enrollment. The latest corroborates that Obamacare enrollment is largely an increase in Medicaid dependency. Let me start off by repeating the same criticism I have made of the Gallup-Healthways survey. Namely, that this survey does not differentiate between people who were uninsured for one month before signing up for Obamacare and those who were uninsured for twelve months. This leads to a too high baseline measurement of the uninsured.

Nevertheless, there is a reduction in the proportion of uninsured, and it is much larger in states that expanded Medicaid than in states that did not [Figure 1]:

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