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More on Medicaid

Mike Tomasky on the question of Texas ditching Medicaid:

The states’ share of Medicaid costs has been an immense burden for two decades, there’s no denying it. I remember Mario Cuomo complaining about it when he was governor, when I first started covering politics in New York. Cost have risen and risen. States set their own reimbursement rates to doc and hospitals, which vary wildly. And yet, Medicaid generally pays primary care physicians only about two-thirds as much as Medicare does.

Now, we bring in the new healthcare bill. It will expand Medicaid vastly and rapidly, by offering subsidies for the purchase of coverage for everyone up to 133% of the poverty line. The feds are going to cover all of these costs through 2019, and 90% thereafter for a bit. But states fear, and again not unreasonably, that over time their Medicaid commitments will expand.

Remember the Cornhusker kickback? This is what it was about: Nebraska’s Ben Nelson wanted an amendment ensuring that Nebraska would not be responsible for covering future Medicaid increases. Right now, states spend on average about 20-25% of their entire budgets on Medicaid – obviously, higher in states with larger poor populations.

Liberals have been aware of these problems, which is why liberals and Democrats have proposed that the feds fully pick up the cost of Medicaid. In the context of the federal budget, it’s not as much money as you might think: Tim Noah of Slate in this article says $25-$30 billion. That’s not nothing, but it could be a findable amount of money in the context of a nearly $4 trillion budget.

Now, there’s another proposal squarely on the table. Just stop doing Medicaid. Stop providing coverage for poor people. Nearly 60 million Americans get their care through Medicaid; this includes roughly one-quarter of the nation’s children.

If Texas followed through and opted out of Medicaid, I doubt it would mean that no poor person in Texas could get treatment. What it would mean is that without the state’s contributions, reimbursement rates would fall even lower, and presumably many more doctors and hospitals would stop treating poor people for all but the most basic-maintenance conditions.

I see little reason to think Texas won’t do this eventually. It saves billions; it’s a way to confront Obamacare; and after all, poor people vote Democratic, when they vote, and Texas is run by Republicans. And I see little reason to think that other states, especially in the south but potentially all over as long as Republicans have enough control, won’t follow suit. Southern states, unsurprisingly, have higher percentages of Medicaid enrollees, since they’re poorer on average.

I daresay there would be litigation almost immediately, with the question coming down to what is required of hospitals for those who truly cannot pay. Bear in mind, whatever the answer to that question is, someone will pay. It’s just a matter of how we apportion the bill.

Here’s Suzy Khimm’s take.

The uninsured poor have already been resorting to hospital emergency rooms for care, and hospitals, in turn, have relied on state governments to cover the costs. If Medicaid coverage were pared back, the hospital ER would likely become the de facto safety net: The number of uninsured ER visits would invariably rise, and the state government would end up paying the price anyway. Texas’s own comptroller, Susan Combs, has admitted as much: In a 2005 paper, she proposes that the state’s Medicaid should be slashed and hospital reimbursements upped instead. But ER visits are extremely expensive, and they won’t serve as a particular cost-effective solution to eliminating insurance, which at least gives patients other options for care.

To be sure, there’s no question that Medicaid has been costly for state governments, and it’s understandable that the lingering recession would make state officials feel panicky about the future expansion. There are deeper programs still: the cash-strapped program only pays providers 66 percent of Medicare reimbursement rates, making it hard for Medicaid patients to find doctors who accept their coverage. Such dilemmas strengthen the argument for simply federalizing the entire Medicaid program, protecting it from the ideological and fiscal battles on the state level.

But until the day comes that a better Medicaid overhaul is possible, states must also realize that simply trying to wash their hands of the problem by stripping Medicaid coverage from the poor — without providing a reasonable alternative — won’t be the answer either. The uninsured poor will continue to get sick. They will continue to seek out health care. And many institutions — including state governments — will still end up paying for it.

Fully federalizing Medicaid has been on the table as a discussion point for at least a year. It would have served as an excellent way to stabilize state finances – we’d be talking about a much more manageable deficit in Texas if this were to come about. And just as was the case with the stimulus and its deficit eradication in 2009, you can imagine the howls of indignity and protest and SOCIALISM and whatnot from the usual gang of idiots. It’s almost as if they’d prefer seeing poor people get sick and die to solving the problem.

And finally, you should listen to this brief clip of Parkland Hospital chief Ron Anderson calling the idea of dropping Medicaid “so bizarre as to be unworthy of consideration.” Factually, sure, but politically, I wouldn’t put it past them.

UPDATE: Via email, State Rep. Garnet Coleman explains what’s at stake here:

One of the truly frightening proposals being floated by Governor Perry and Republicans in the Legislature is the idea of abandoning the Medicaid program altogether. It’s hard to imagine that voters that cast their ballots for Republicans last week were actually voting to close nursing homes and kick the elderly, disabled, people with developmental disabilities, and the blind out on the street, but some on the extreme end of the ideological spectrum are interpreting their mandate that way.

More than 4 million of our state’s most vulnerable residents- children from low-income families, the elderly, pregnant women, the mentally ill, and the disabled- rely on Medicaid to access health care. Abandoning Medicaid would mean that four millions Texans would be without:

  • Early and Periodic Screening, Diagnosis, and Treatment
  • Family planning
  • Home health care
  • Inpatient and outpatient hospital
  • Lab and X-ray
  • Nursing facility care
  • Pregnancy-related services
  • Physician services

Children would lose long-term physical, occupational, and speech therapies, and comprehensive dental services.

Medicaid recipients would also lose access to the below services:

  • Ambulance
  • Birthing center
  • Certified registered nurse anesthetists
  • Chiropractic
  • Dental care-preventative and therapeutic (under 21)
  • Durable medical equipment
  • Emergency hospital services
  • Hearing instruments and related audiology
  • Hospice care
  • In-home respiratory care
  • In-home tube feeding
  • Institutions for Mental Disease (under 21 and over 65)
  • Intermediate Care facilities for people with Mental Retardation or Developmental Disabilities (ICF/MR)
  • Licensed marriage and family therapists
  • Licensed clinical social worker
  • Licensed professional counselor
  • Maternity care clinics
  • Medical transportation to Medicaid covered health care services
  • Medically necessary surgery and dentistry
  • Nurse practitioner and clinical nurse specialist
  • Occupational therapy
  • Optometry-eyeglasses and contacts
  • Personal care services in the home
  • Physical therapy
  • Podiatry
  • Physician Assistant
  • Prescription drugs (three per month in Texas, unlimited drugs for nursing facility residents, participants in certain 1915(c) waiver programs, persons under 21, and managed care participants)
  • Private duty nursing (under 21)

In this tough economy, as more Texans have become dependent of Medicaid, abandoning this program would kick people when they are down. The mere mention of abandoning this program is ludicrous. You can be sure that I’ll keep you informed with any new developments.

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One Comment

  1. Brennan Griffin says:

    I do tend to think that the entrenched interests would kill this idea before it gets too far – not for ideological reasons, but simply because hospitals and doctors are powerful interests even (especially?) in Republican led areas. Hospitals are huge employers in many places, and even conservative doctors might figure that taking up to $24 billion (the federal share of Medicaid) out of the health care system might have some adverse effects on their industry. Scary as all of this sounds, I bet it comes down to some posturing and attempts to get out of a few requirements that come with Medicaid for form’s sake.