Blood from a stone: Medicaid co-pays are bad health policy
In Missouri, you can live in poverty but still not be poor enough to qualify for Medicaid. Adults have to earn less than about 25 percent of the federal income poverty level — roughly $3,700 a year for a single mother raising two children — before they qualify for state Medicaid assistance.
And even that’s too rich for President George W. Bush. On its way out the White House door, Mr. Bush’s administration has published a new federal rule that would allow states to add co-payment charges to poor people receiving care through Medicaid. If they can’t afford it, the new rule will for the first time allow doctors and hospitals to turn them away.
The administration — which has handed hundreds of billions of dollars in tax cuts to well-off Americans — devised its new Medicaid policy to save money. But about 80 percent of the savings, according to the nonpartisan Congressional Budget Office, will be the result of low-income Medicaid enrollees not getting the medical care they need because they can’t afford the new co-payments.
At first blush, it might seem that the co-payments are no big deal. The new rule says that people living below the poverty line can be charged $3.40 per doctor or clinic visit; that’s small change for most of us.
It’s not small to a family of three trying to get by on less than $3,700 a year. A single mother with two children who earns more than that is too rich to qualify for Medicaid in Missouri.
A new study by the Missouri Foundation For Health examined what it actually costs to provide household necessities — housing, food and transportation — to rural and urban families in our state.
In rural Missouri, the study found that a family consisting of one adult and one child would need nearly $22,000 a year to cover those expenses. That’s about seven times more than a working parent with one child could earn and still qualify for Medicaid.
In St. Louis or Kansas City, an adult with a single child would have to earn about $27,000, more than eight times the top income for Medicaid, to cover those basic expenses.
We don’t have to speculate about the results of charging co-payments to poor people on Medicaid. In 2003, Oregon got federal permission to start doing just that. Enrollment dropped, and studies showed that many of those who lost coverage went without needed care.
Low-income adults who are enrolled in Medicaid have higher rates of chronic illness than the overall population. When people with chronic illnesses skip routine care, they tend to get seriously ill. Medical care for seriously ill people is more expensive than routine care used to manage chronic illnesses. So putting roadblocks between chronically ill people and routine medical care costs society and taxpayers more in the long run than any short-term savings.
At a time when the need for safety net medical care is growing because of the deep recession, the new Bush rules will make that care harder to get.
The new rule requires that state lawmakers first approve moving to a system that includes co-payments, but in Missouri, the temptation to go along will be great. Wayne Goode, a budget advisor to Gov.-elect Jay Nixon, said Tuesday that the state is facing a $340 million budget shortfall.
Illinois, which has more a generous Medicaid program, also faces a budget shortfall; some estimates say it could be as much as $2 billion.
Co-payments offer only false economy. In the short run, they will increase the hardships of the most vulnerable of us. In the long run, they will result in higher Medicaid costs.
The American Academy of Pediatrics, the National Association for Home Care and the AARP all have opposed the new Bush administration co-pay rule. Congress can and should override it.
Soaking the poor for health care isn’t just bad health policy, it’s moral bankruptcy.
Mr. Carlton, there are a few important things you seem to forget here: First, that health care costs money, and somebody has to pay for it. Second, the poor respond to incentives just like the rest of us. Third, those who have had sporadic access to health care have never developed habits of using health care services judiciously, in terms of preventing waste yet achieving good outcomes.
The point of a copay is to reduce frivolous use of care. The copay is SUPPOSED to hurt a little. That’s why on my private insurance plan, there’s a $50 ER copay, only a $20 physician visit copay, and NO copay for follow-up maternity visits. While I realize it’s just anecdotal, I’ve known lots of people on Medicaid over the years, and they use the ER at a rate that bewilders me. If judiciously applied copays can be used to push them into efficient use of our health care system, it will be a very good thing.
Demanding that every poor person receive a blank check for health care, without even attempting to use the most basic utilization management tool, isn’t just bad health policy, it’s moral bankruptcy.
John, we know your a progressive, so try to think outside the box. I propose that needy people can be co-pay exempt under these conditions:
l. They are no more than 25 lbs overweight.
2. They do NOT smoke.
3. They pass a test for being free of illegal substances
4. Have no more than one tatoo.
5. Don’t own a cell phone.
Otherwise, they can afford the co-pays.
That’s good, Centrist. Not only does it address several risk factors which contribute significantly to health care costs, it also serves the progressive aim of advancing the reach of the nanny state. Outstanding!
In addition to the obvious idea you so abhor — that people should get what they earn — co-pays also help. A person that has to pay for a doctor’s visit or medication is much more likely to be compliant with what the doctor says. You can check recent editions of the NEJM, JAMA as well as multiple foreign journals if you would like, Mr Carlton, although that would mean you might have to know a small part about what you write about.
To deny the poor the benefit a co-pay has on subsequent compliance would be negligent on the part of the physician.
Health care follows something called the 80/20 rule — 80 percent of the costs are incurred by 20 percent of the patients who have very serious illness. Most of the cost, in other words, doesn’t come from frivolous use of medical resources (despite what you may think), but from people who are very sick.
Putting up barriers to routine care, especially in people with chronic illness, just means they wait until they’re sicker, and more expensive to treat, to get care. The classic example is the person with asthma who doesn’t fill a prescription, then winds up in the emergency room. And numerous studies have shown that people with chronic illness who don’t have a regular source of routine care are more likely to use emergency rooms — exactly what you say you want to avoid.
Besides all of that, I’d be interested to know where you think a single mother raising two kids on $3,700 a year is going to find money for a co-pay.
Mr. Carlton, your last post has to be the most absurd I’ve ever seen.
* First of all, nobody in the United States is “raising two kids on $3,700 a year.” It’s absolutely impossible, and you should be ashamed for saying it.
* Second, while you are right that the big bucks are spent on the most seriously ill, the Medicaid recipient who is hospitalized with cancer isn’t going to incur a copay every time a nurse walks up to her bed - she will pay a single copay for an inpatient stay, and that copay will be very modest compared with the costs incurred.
* Third, while you are right that an asthmatic on Medicaid may not fill her prescription because of a copay, that argument only speaks to copays on medication, not to copays on care. Though I must ask another question in that regard: If copays on prescriptions do not reduce overall cost to the insurer, why does every private insurance plan have a prescription copay? Seems like they’d pay YOU to get your prescription if it was going to save them money.
The literature on this subject is inconclusive. A 2006 study in the American Journal of Managed Care concluded that adverse events increased when a prescription copay was required. A 2007 study in Value in Health also found increased adverse incidents, in this case as a result of Massachusetts increasing its Medicaid prescription copay from 50 cents to $2. But the overall impact was a cost savings of $2.1 million.
(By the way, I think this is what jvqb meant when he suggested you look at some journals instead of just making off the cuff remarks about a family of 3 surviving on $300 a month, and the “80/20″ rule.)
A CENTRISTS,
There are truly poor people in this State who do even own a land-line phone less known a wireless one or otherwise and they do not abuse substances etc… There are truly poor people in this State who do not have family members that can help them through the rough times.
You are being utterly ignorant to believe that the truly poor do not exist here in Missouri. Be careful that you ones who are so lacking of belief that such exist do not find yourselves becoming believers due to your own plight.
Are you kidding me this article was clearly written by someone who takes facts and figures from books and deciphers truth from. Lady I’m here to tell you that as a tax payer, a nurse, and a hard working American I can tell you that the government does need to crack down on Medicaid and Medicare. Maybe not by increasing the copays how about cracking down on 30 yr olds that have full disability for “anxiety” that have no problems spending that check on brand new cars, expensive cell phones, name brand clothes and support their 2 pack a day smoking habits (not that I’m against smoking I figure I’m free and I can smoke whatever is legal it called my rights) and how about the 46 yr old who was on full disability for “diarrhea” who was literally full of stool because of overuse of narcotics that he bought with his medicaid. Or the alcoholic that was on full disability that spent over $750 a mo in alcohol and cigarettes (awesome I love working my ass off to support my family so he can get drunk off my dollar!) So don’t tell me about healthcare until you’ve lived in the trenches princess. I see people everyday that rack up thousands of dollars in ER charges because they don’t like to have to wait to get into see a doctor or a dentist for a tooth ache they’ve had for a year, or back pain they have not treated with an ounce of OTC meds or how about the “I have a cold and I need some pain meds and my pain is a 10 out 10 at least!” as they are sitting there laughing with their other friends they’ve now convinced to waist the ER time with for drug seeking behavior.