George Gibbs Center for Economic Prosperity

Knoxv⁠i⁠lle News Sen⁠t⁠⁠i⁠nel — Dr. Jason Fodeman: Med⁠i⁠ca⁠i⁠d expans⁠i⁠on could add ⁠t⁠o delays

By: The James Madison Institute / 2014

Knoxville News Sentinel 
Dr. Jason Fodeman: Medicaid expansion could add to delays
By Dr. Jason Fodeman
November 8, 2014The Affordable Care Act’s Medicaid Expansion remains one of health care reform’s most hotly-contested provisions. The arguments surrounding the expansion have largely focused on the economic and political implications of expanding Medicaid to 138% of the federal poverty level. While these ramifications are certainly worthy of meticulous debate, there are important medical ramifications of the Medicaid Expansion as well. A recent Wall Street Journal article raises some of these concerns.The article cites significant Medicaid backlogs in certain states. This could be made worse by the Medicaid Expansion. According to the article, there are hundreds of thousands of people across the country who have signed up for Medicaid and have waited months for coverage. Residents in California and Tennessee have actually filed lawsuits after encountering lengthy delays in acquiring coverage.The article reports that in Tennessee 10,000 Medicaid applications are pending and in New Jersey 12,000 are waiting. In California there are 159,000 Medicaid applications in the queue. Generally, states are required by federal regulation to process Medicaid applications within 45 days.These delays in application processing could result in delays in care that allow diseases to fester and become more severe.The article emphasizes an important point. There is a stark dichotomy between access to health insurance and access to health care. Clearly the latter is the benchmark and while government health insurance does provide the former, at times it can fail to offer timely access to health care.In a world with infinite resources expanding Medicaid would no doubt be altruistic. Yet, in our world with limited resources it requires difficult choices and answers to tough questions:
Do states have the resources to timely process and handle the applications of seventeen million new Medicaid beneficiaries? And, more importantly, where will the seventeen million new beneficiaries receive care?These are crucial questions that any state looking to expand Medicaid for genuine reasons must have answers to before proceeding down this path in any way. The stakes are way too high to wing it. We cannot afford to see the care of the most needy turn into another fiasco.Presently, flaws in Medicaid statute get passed along to beneficiaries in the form of restricted access, long waits for appointments, and compromised care. At the same time, the program is also replete with waste, fraud, and abuse.Medicaid leaves state regulators and policymakers with few options to control rising program costs other than paying providers less or coming at the expense of other state priorities like education, transportation, and security.A 2011 Kaiser Medicaid study concluded that “As in previous years, provider rate restrictions were the most commonly reported cost containment strategy.”As a result, Medicaid reimbursements have fallen well below those of private insurers and Medicare. According to the 2012 Kaiser Family Foundation Medicaid to Medicare Fee Index, across the country Medicaid reimbursements are 66% of Medicare reimbursements for all services and 59% of Medicare primary care reimbursements. Medicare reimbursements are already lower than those of private insurers. Sometimes payments from government health insurers for services can be even less than the cost to provide those services.Due to declining reimbursements and the administrative hassle of the program, many providers are reluctant to participate in the program. Thus, Medicaid beneficiaries can have a hard time getting access to timely care. They can encounter lengthy delays or be forced to depend on expensive, overcrowded, disjointed emergency rooms for care. Both these factors contribute to poor health outcomes for Medicaid patients. This is well documented in the peer reviewed literature.The Medicaid Expansion is no panacea to these problems. Nor has it ever been billed as such. While efforts must be made to improve access and care of the uninsured and underinsured, the Medicaid Expansion is no silver bullet. Medicaid is a program in need of more reforms, not more beneficiaries.Without a strategy to navigate the imminent tough questions, it is very likely that under the Medicaid Expansion, things could get worse before they get better. Dr. Fodeman is a James Madison Institute Adjunct Scholar. Article: