This column is a collaboration between KHN and
The New Republic.
Rep. Bill Cassidy of Louisiana is not just a Republican. He's also a doctor. And that means he has not one but two reasons to dislike Medicaid. Not only does it cost the government a lot of money. It also serves a lot of its beneficiaries poorly.
Cassidy explained in a Dec. 16 column for Politico that Medicaid is the stingiest payer in our health care system. For most services, it reimburses less than both Medicare and private insurance. The people who provide medical care -- doctors, hospitals, and so on -- are well aware of this and they structure their practices accordingly. Some won't see Medicaid patients at all. Some will see only a few.
As a result, the people who have Medicaid frequently end up at places like Earl P. Long hospital in Baton Rouge -- a public hospital where, I gather, Cassidy has worked. "The hospital has dedicated and caring doctors, nurses, technicians and support staff," Cassidy writes, "But its physical plant is in disrepair." Four patients to a room, asbestos in the structure, missing doors -- the people of Baton Rouge only go there if they have no other option, according to Cassidy. And that means people with Medicaid, even though they technically have insurance.
Cassidy tells us this story because the new health law is expected to increase Medicaid enrollment by about 16 million people. Cassidy thinks this is a terrible idea -- and he's not the only one. Because the states, under federal supervision, run and help finance Medicaid, Republican governors and even a few Democrats have been screaming that this expansion will bankrupt their treasuries. Texas Gov. Rick Perry went so far as to threaten pulling Texas out of Medicaid altogether -- an idea, reportedly, that other Republicans also are contemplating.
I don't actually disagree with the underlying assessment of Medicaid: Lots of people on the program have few choices for medical care. But I have a question for Cassidy, Perry and all the other state officials who oppose expanding Medicaid and, in some cases, support getting rid of it once and for all: What do you propose to do instead? The answer, as far as I can tell, is to do nothing -- or, at least, very little. That's not very smart. And, more important, it's not very humane.
Medicaid may not provide great access to care. But it does provide access -- access its recipients very much need and that, according to research, has measurably improved their health. In what may be the most well-known study of its kind, economists Janet Currie and Jonathan Gruber found large expansions of Medicaid during the 1980s and early 1990s "significantly increased the utilization of medical care, particularly care delivered in physicians' offices," leading to "significant" reductions in both infant and child mortality.
Medicaid also provides benefits that its unique population needs, but would struggle to find in the private insurance market. That includes lead screening for low-income children, a fragile population at high risk of toxicity from chipped paint in old, poorly maintained homes. And it includes long-term care, particularly nursing home care, for senior citizens who can't afford its high expense. In fact, it is the disabled and the elderly -- not the stereotypical single mother on welfare -- on whom Medicaid spends the majority of its money.
Could the program be better? Absolutely. Like every health insurance program in the country, private and public, it could do more to promote the management of chronic disease. Fraud demands more vigilance, particularly from the states. But, by far, the best way to improve Medicaid would be to give it more money per beneficiary -- so that it pays providers something closer to what Medicare and private insurance pay. Do that and those Medicaid patients in Baton Rouge would get care that looks more like the treatment people with good insurance receive.
Is this what Cassidy, Perry and the other Medicaid critics want to do -- to spend more money on the poor? It doesn't appear so. In general, the people attacking Medicaid want to spend less on the program. And while critics sometimes argue private insurance could deliver coverage more cost effectively, the claim is hard to fathom. According to the Kaiser Family Foundation (KHN is a program of the Foundation), Medicaid spends on average $2,500 per year for non-elderly adults -- roughly half what a single person pays today for a private health insurance premium. (That's the upside of a program that pays doctors and hospitals so little. It's very cheap to run.)
Sure enough, Cassidy's protest against expanding Medicaid includes no proposals for other ways to cover the 15 million people the program will take in under the new health law. And when Perry threatened to withdraw from Medicaid, he wasn't terribly specific about how Texas would provide health care to the roughly 4 million residents now on the program. Of course, we don't need them to tell us what the world would look like without government health care programs for the poor. We need only look at what happened before Medicaid came into existence, or what happens right now to the working poor and the rest of the uninsured. They go without health care and face severe financial distress.
You don't have to take my word for it. After Perry made his threat, officials and medical professionals in Texas were among the first to protest -- because, in the absence of Medicaid, they'd also pay a price. A study by the Texas Health and Human Services Commission suggested that if the state really left Medicaid, it'd stand to lose about $15 billion a year, thanks mostly to the loss of federal matching funds. The burden of charity care would weigh even more heavily on doctors and hospitals; and the strain on the population would grow. None of these people think Medicaid is ideal. But they also understand how vital it is -- and how foolish eliminating would be.