Health Care

Activists’ claims, research, at odds

April 24, 2019

Ray Carter

Activists attending a Wednesday rally at the Capitol described expansion of Medicaid as a moral crusade that will save lives.

“This is more than a political movement,” said former Sen. Angela Monson, D-Oklahoma City. “It’s a moral, a spiritual, a heartfelt movement. It’s what we should do as human beings to help other human beings.”

Under the traditional Medicaid program, states receive roughly 60 cents in federal money for every 40 cents provided in state funding to give government health coverage to very low-income and disabled individuals. But under the federal Affordable Care Act, better known as Obamacare, states receive a 90-10 match to cover able-bodied adults who earn too much to qualify for the current program. So far, Oklahoma lawmakers have declined to expand the program due to concerns regarding its cost and effectiveness.

The rally, attended by roughly 200 people, included several anecdotal stories of uninsured Oklahomans facing financial struggle. But when participants shifted from emotional appeals to fact-based arguments, several claims put forth have been undermined or contradicted by independent research.

Scott Melson, an Edmond doctor, said Medicaid expansion grants “access to critical, life-saving services without having to use the local emergency department, generating huge bills, increasing wait times, and ultimately increasing costs to the health care system.”

In 2008, Oregon approved a partial expansion of Medicaid that used a lottery to cover a portion of the population later covered by the ACA’s Medicaid expansion. This allowed researchers at the Massachusetts Institute of Technology to examine the health outcomes of 6,387 adults covered by Medicaid expansion to the outcomes experienced by a comparable group of 5,842 adults not enrolled in the program.

That research, published in The New England Journal of Medicine, found Medicaid coverage did not produce “significant changes in visits to the emergency department or hospital admissions.”

Another study, published in 2014 in the journal Science, found that Oregon citizens added to Medicaid made 40 percent more visits to the emergency room than uninsured counterparts. The abstract states that researchers “found increases in emergency-department visits across a broad range of types of visits, conditions, and subgroups, including increases in visits for conditions that may be most readily treatable in primary care settings.”

Rep. Emily Virgin, D-Norman, told rally attendees that people in states where Medicaid has been expanded “spend less money on health care than Oklahoma families and they have more citizens covered and have better outcomes than Oklahoma.”

Independent research has shown relatively little impact on health outcomes from Medicaid expansion.

In 2017, research published in the National Bureau of Economic Research examined the Affordable Care Act’s real-world results by analyzing the prior two years of data from the Behavioral Risk Factor Surveillance System, an annual medical survey conducted by the federal Centers for Disease Control.

“No statistically significant effects on risky behaviors or self-assessed health emerge for the full sample,” the abstract noted.

In The New England Journal of Medicine article, researchers concluded that Oregon’s Medicaid expansion “generated no significant improvements in measured physical health outcomes in the first 2 years.”

As with other studies, it did find Medicaid enrollees used medical services at a higher rate than uninsured citizens, but that access did little to improve health outcomes. Mostly in minor, and sometimes subjective, measures did Medicaid produce improvements with the most notable exception being a higher rate of diabetes detection and management.

Many rally participants suggested Medicaid expansion would improve the financial stability of rural hospitals in low-population areas. Rep. Marcus McEntire, R-Duncan and chair of the House Appropriation and Budget Subcommittee on Health, was among those making that case.

“Our hospitals are suffering due to uncompensated care,” McEntire said. “Some of that is due to the reimbursement rate of Medicaid.”

Yet the low reimbursement rates cited by McEntire have made Medicaid expansion problematic for hospitals in some expansion states. In 2015, a Kentucky Hospital Association report, “Code Blue: Many Kentucky Hospitals Struggling Financially Due to Health System Changes,” warned that Kentucky hospitals “will lose more money under the ACA than they gain in new revenue from expanded coverage.” At that time, Kentucky hospitals projected a loss of $1 billion from 2014 to 2020.

In Kentucky, hospital losses were driven by the fact that many people were shifted from private insurance policies to Medicaid. The report found up to 20 percent of people covered by Medicaid previously had private health insurance. Because private health insurance usually pays hospitals more than Medicaid, the expansion of Medicaid actually reduced hospital revenues.

“While more patients have coverage under health reform, a larger portion of reimbursements made to hospitals will not cover costs,” the report noted.

Research has indicated similar challenges are possible in Oklahoma. In 2013, a Leavitt Partners report predicted that 10 percent or more of those covered through any Medicaid expansion in Oklahoma would substitute taxpayer-subsidized coverage for previous employer-provided coverage.

Hospitals have fared better in other expansion states, but that has not benefited consumers.

A recent report by the Colorado Department of Health Care Policy and Financing shows Medicaid expansion did not reduce cost-shifting to citizens with private insurance. Instead, hospitals mostly pocketed the increased revenue. The report concluded that Colorado hospitals “could have passed on significant savings to commercial consumers” of as much as $7.9 billion from 2009 to 2017, but did not. The report found that “the under-compensation for Medicaid-covered and uninsured patients improved significantly” for hospitals but that “the overcompensation for care (increased charges) to commercially covered patients was unchanged.”

Dr. Keith Smith was not among those gathered at the Capitol in favor of Medicaid expansion. Smith, the medical director, CEO and managing partner of The Surgery Center of Oklahoma, warns that expansion could have significant consequences.

“Twenty-seven percent of Oklahomans are already on Medicaid,” Smith said. “That’s over one-in-four.”

He noted the current program is narrowly targeted to benefit pregnant women, the blind, and disabled.

“The problem is expanding Medicaid even more than it is now at one-in-four, what is our goal?” Smith asked. “Do we want half the population on Medicaid? Do we want no private insurance?”

(Smith is a member of the board of trustees for the Oklahoma Council of Public Affairs, parent organization of the Center for Independent Journalism.)

While the current Medicaid program is supposed to benefit some of Oklahoma’s neediest citizens, the state struggles to even address that group’s needs. Smith pointed to a colleague’s daughter who has permanent neurological damage and must reapply “every year” for assistance. Despite her clear need, Smith said the young woman “struggles to get the necessary services.”

“We can’t even administrate the appropriate services for Medicaid as it is now,” Smith said, “much less adding 600,000 able-bodied people onto this.”