The Medicaid Challenge, Part II: Reimbursement & the Federal Government

Last week I looked at some of the major problems afflicting the Medicaid program, including low reimbursement rates for doctors, patients’ lack of access to care, a lower quality of available care, stringent eligibility requirements, and complicated enrollment procedures. In this post I’m going to talk about what we can do to address Medicaid’s deficiencies, specifically with regards to physician reimbursement, quality of care, and the relationship between states and the federal government with regards to Medicaid.

Reimbursement and Access

As I’ve noted in the past, Medicaid reimbursement rates for physicians are very low—on average, just 69 percent of Medicaid rates. They also vary widely across different states. In New York, doctors are paid $20 for an hour-long consultation with a Medicaid patient; in some higher-paying states, doctors receive an average of $157.92 for the same service—a more than sevenfold difference.

Clearly, increasing Medicaid reimbursement is an important part of making the program more appealing to doctors, and thus improving patients’ access to care. Indeed, studies show that when reimbursement fees are higher, pregnant women are more likely to retain their doctors for long-term care and children are more likely to have regular access to a doctor and to preventive care. Studies from the Center for Studying Health System Change and the New America Foundation have found that “variation in Medicaid reimbursement levels across states contributes to community variations in physicians willingness to accept Medicaid patients,” and that “high fee levels increase the probability that individual physicians will accept Medicaid patients.”

A State by State Report on Children’s Health: Family Income and Education More Important than Medical Care

The Robert Wood Johnson Foundation’s Commission to Build a Healthier America has just released a report that reveals the degree to which a child’s health is determined by the hand he draws when he is born.

The report, which is titled “America’s Health Starts With Healthy Children: How Do States Compare?” confirms what we have written in other Health Beat posts.

While having or not having health insurance is important, poverty will have an even greater influence on an individual’s health. As Commission Co-Chair and former Congressional Budget Office director Alice M. Rivlin puts it, “This report shows us just how much a child’s health is shaped by the environment in which he or she lives.” 

Moreover, the report reveals that it is not only the poor who are molded by their environment. “In nearly every state, children in middle-income families also experience shortfalls in health when compared with those in higher income families. And these differences in children’s health by income can be seen across racial or ethnic groups”  says the report, which is based on  research  done at the University of California at San Francisco’s Center on Social Disparities in Health. Ultimately, this study highlights “the unrealized health potential possible if all children had the same opportunities for health as those in the best-off families.”

“Most of our efforts to improve health have focused on improving quality, access to and affordability of care. While these are important, support for better health that is associated with resources and community matters as well,” says Commission Co-Chair Mark McClellan. “As a nation, we clearly need to do better…a large body of research shows that the causes [of poor health among children] are complex,” the report observes, “and that medical care interventions are important but not sufficient.”

To illustrate “the magnitude of the link between education and health” the Commission also is releasing a new online tool that lets viewers see the connection first hand, says Dr Steven Woolf, a professor of Family Medicine at Virginia Commonwealth who was involved in developing the tool. (Readers who want to check the relationship between education and premature deaths in their state or country will find the tool here).

Updates on Recent Posts

Every now and then I like to follow-up on recent posts to highlight the fact that so many of the issues we address on Health Beat continue to develop after we write about them.  So, without further ado, some additional coverage of recent post topics:    

AHLTA

I’ve criticized AHLTA, the Defense Department’s computerized medical record system, in three separate posts. And with good reason: the troubled system will ultimately cost tax payers $20 billion, despite the fact that it processes data slowly, is prone to errors, is disliked by military clinicians, and is incompatible with VistA, the Veterans Administration’s successful health care IT program.

I’ll spare you a fourth AHTLA essay and instead direct you to an update by Bob Brewin of Government Executive magazine which ran a few days ago. 

Brewin reports that “AHLTA…poses safety risks…Medication reconciliation -- a process that requires developing a complete list of patients' medications and dosages -- is key to ensuring patients are not prescribed drugs that don't mix well. But, ‘AHLTA does not allow complete and uncompromised medication reconciliation [and] therefore remains a patient safety risk,’ said Lt. Col. Carter Hale...

“Army Lt. Col. Daniel Schissel, president of the Association of Military Dermatologists, reported that the application has decreased his productivity. He commented that before AHLTA, he was able to see 5,000 patients annually and record each encounter with excellent, albeit written, notes. Post-AHLTA, he sees 3,600 patients annually and describes encounters in electronic note templates that he says are so cryptic a follow-on provider would have difficulty visualizing where he had removed a spot of cancerous melanoma. It would be helpful to attach a photo, but Schissel said MHS [Military Health Service, the DoD section that manages AHLTA] clinicians now are discouraged from doing so, ‘as photos are difficult to load and consume large amounts of bandwidth.’

Is Healthcare a "Right" or a "Moral Obligation"?

I have to admit I often have found the language of healthcare “rights” off-putting.  Yet the idea of healthcare as a “right” is usually pitted against the idea of healthcare as a “privilege.” Given that choice, I’ll circle “right” every time.

Still, when people claim something as a “right,” they often sound shrill and demanding. Then someone comes along to remind us that people who have “rights” also have “responsibilities,” and the next thing you know, we’re off and running in the debate about healthcare as a “right” vs. healthcare as a matter of “individual responsibility.”      

As regular readers know, I believe that when would-be reformers emphasize “individual responsibilities,” they shift the burden to the poorest and sickest among us. The numbers are irrefutable: low-income people are far more likely than other Americans to become obese, smoke, drink to excess and abuse drugs,  in part because a healthy lifestyle is  expensive, and in part because the stress of being poor—and “having little control over your life”—leads many to self-medicate. (For evidence and the full argument, see this recent post).  This is a major reason why the poor are sicker than the rest of us, and die prematurely of treatable conditions.

Those conservatives and libertarians who put such emphasis on “individual responsibility” are saying, in effect, that low-income families should learn to take care of themselves.

At the same time I’m not entirely happy making the argument that the poor have a “right” to expect society to take care of them. It only reinforces the conservative image (so artfully drawn by President Reagan) of an aggrieved, resentful mob of freeloaders dunning the rest of us for having the simple good luck of being relatively healthy and relatively wealthy. “We didn’t make them poor,” libertarians say. “Why should they have the ‘right’ to demand so much from us?”  Put simply, the language of “rights” doesn’t seem the best way to build solidarity.  And I believe that social solidarity is key to improving public health.

Given my unease with the language of rights, I was intrigued by a recent post by Shadowfax, an Emergency Department doctor from the Pacific Northwest who writes a blog titled “Movin Meat.”  (Many thanks to Kevin M.D. for calling my attention to this post.)  Shadowfax believes in universal healthcare.  Nevertheless, he argues that healthcare is not a “right,” but rather a “moral responsibility for an industrialized country.”   

Will the Economic Meltdown Undermine Interest in Health Care Reform?

Writing on The Health Care Blog, D.C. insider Bob Laszewski puts the chances of health care reform—at least in the form envisioned by the presidential candidates and ambitious activists—at about zero in the wake of Wall Street’s meltdown. It’s easy to see why Laszewski is so pessimistic:

“On top of the $500 billion deficit [that the government faces ]in 2009…and the cost of the Freddie and Fannie bailout . . . the Congress is now being told it must take on a total of almost $1 trillion in government long-term costs to try to turn the financial system around.”

That’s a problem. McCain claims his reform plan will cost $10 billion; Senator Obama says his will cost $65 billion. Both are no doubt low-ball estimates. Obama’s plan, for example, is more likely to cost $86 billion in 2009 and $160 billion in 2013, after it’s expanded, according to the Urban Institute. Given these numbers, Laszewski says that the candidates have to “get…real” about how they’re “really going to deal with health care reform in the face of all of these challenges.”

In an upcoming post, Maggie will dig deeper into just how health care reformers can and should ‘get real’ in post-meltdown America. But instead of talking about what reformers should do, I want to discuss another important question we have to pose in the upcoming age of austerity: will the public even care about health care reform anymore, now that the economy has gone south?

Primary Care Doctors, Specialists and Medical Homes, Part II

Healthcare reformers talk of a day when every American will have a “medical home.”   But as I noted in part I of this post (“Americans Who Have Insurance—But Still No Access to Care”), it is not at all clear who will be “at home” in these homes.

While health policy wonks envision a legion of 21st century Marcus Welbys who know their patients, consult with their specialists, send out timely reminders, and keep a meticulous record of their medical histories, the truth is that we’re facing a severe shortage of primary care physicians (PCPs). A recent study of 1,200 fourth-year students published in the Journal of the American Medical Association showed that only 2 percent planned to work in primary care. In a similar study in 1990, the figure was 9 percent. 
In just the last ten year years, the number of U.S. medical students choosing to enter family medicine has fallen by 50 percent according to a report released by the Texas Primary Care Coalition (see chart below).

One reason medical students shun primary care is the relatively low pay. As the chart and table below reveal, over the last decade, dermatologists, radiologists gastroenterologists and orthopedic surgeons have seen their incomes skyrocket while the incomes of family doctors and internists lag far behind. 

The Medicaid Challenge (Part I)

In theory, Medicaid ensures that low-income families receive health care. But in practice, the program leaves much to be desired—and serves as a painful illustration that the existence of an insurance program isn’t enough to ensure access to necessary care.

On paper Medicaid offers pretty comprehensive coverage, seemingly even better than Medicare. For example, Medicaid covers long-term care for the elderly, nursing home care, and offers broader prescription drug benefits than Medicare.

But all the benefits don’t mean a thing if patients can’t find doctors to provide them. In a post last November, I noted that reimbursement rates for Medicaid are abysmally low across the nation as compared to both private insurance and Medicare: in New York, doctors receive $20 for an hour-long consultation with Medicaid patients, whereas a physician could earn almost $200—about 10 times as much—for such a consultation under Medicare. In 2007, the Wall Street Journal reported that Michigan’s Medicaid program pays $20 for a chest x-ray, where as Medicare pays $30 and private insurer Blue Cross, $33. For performing an appendectomy, a Michigan doctor can expect $784 from Blue Cross and just $336—about 42 percent as much—from Medicaid.

There’s nothing inherently easier about treating poor people—in fact, Americans stuck on the lowest rungs of our socioeconomic ladder tend to be in poorer health. Yet doctors are paid less under Medicaid and as a result are closing their doors to low-income patients: a 2006 Center for Studying Health Care System Change report found that the percentage of physicians who accepted no new Medicaid patients in 2004-2005 was “six times higher than for Medicare patients and five times higher than for privately insured patients.” Reimbursement was a major concern here: 84 percent of physicians who did not accept new Medicaid patients in 2004-2005 said reimbursements were a factor; 70 percent of physicians said billing requirements and paperwork were a factor; and two-thirds said delayed payments were a factor. (While Medicare, a federal program, has a reputation for paying providers in a timely manner, Medicaid—administered by states—is a much more haphazard affair, and can leave doctors waiting for months).

Getting More Value from Medicare

With Medicare’s financing unraveling, Medicare reform will need to be high on the next president’s agenda. In a new report from The Century Foundation, fellow and HealthBeat Blog editor Maggie Mahar (www.healthbeatblog.org) points out that past proposals for containing Medicare’s costs, such as putting a cap on physicians’ fees or requiring beneficiaries to pay more for their care, have not worked. She calls for a fundamental set of reforms that would not only save money but also improve the quality of care that beneficiaries receive.

You will find the report at www.tcf.org later today.

An Update on Gardasil

Over at the Center for Media and Democracy’s PR Watch http://www.prwatch.org/node/7748  Judith Siers-Poisson writes:

“With the start of the school year, debate has heated up again about Gardasil, Merck's vaccine against human papillomavirus. Since writing my series of four articles on The Politics and PR of Cervical Cancer last year, I have continued to track the developments

“The push for mandatory vaccination continues, and many of its supporters have received money from Merck, including Women in Government, about whom I wrote extensively in my article, "Women in Government: Merck's Trojan Horse." Despite a palpable turning of the tide against mandates, Women in Government still swims against the current. In a 2008 report titled "State of Cervical Cancer Prevention in America," WIG continued to push for mandates and gave higher scores to states that have introduced or passed legislation for this purpose.”

Obama vs. McCain: Their Health Care Plans; An Attempt at Nonpartisan Analysis-- Part 1

Each presidential candidate offers a blueprint for health care reform. Neither can expect to see his plan enacted whole—legislators will leave their fingerprints all over any proposal. And, if truth be told, neither plan is perfect. Each proposal is blinkered in its own way; each ignores just how difficult true reform will be. I very much doubt that national health insurance will become a reality in the next year.

That said, I believe that we can take steps toward reform in 2009 if we begin thinking clearly—and honestly—about exactly what it is that we want and what it will cost. To that end, I believe that in-depth analysis of each candidate’s proposal can help underline the core ideological differences between conservatives, libertarians and progressives, and highlight the economic realities that any reform plan will have to face.

Recently, opponents of each plan have offered their critiques in Health Affairs (here and here) and supporters have defended their favorites  here  and here. Inevitably, many readers found the critiques too partisan. At the same time, they complained that rebuttals from the home team “read more like a stump speech with details glossed over and facts overlooked.”   

Readers are still looking for an unbiased, in-depth report on the two plans that clarifies the details and the differences. Earlier this week, the Urban Institute, a nonpartisan economic and social policy research organization, published an assessment of the two proposals that sets out to do just that. Overall, the Institute’s report seemed to me remarkably fair—and certainly worth discussion. 

The Strengths of the Obama Plan 

First, the Institute notes, rightly, that Obama’s plan would “substantially increase access to affordable and adequate coverage for those with the highest health care needs, including those with chronic illnesses” by: