Congress, Don't Forget About Reforming Medicaid
With all the debate surrounding the Affordable Care Act, Congress cannot forget the need to reform Medicaid. The program is beleaguered by bureaucracy, rigidity, fraud and low physician participation. These problems undermine its mandate and come at the expense of the poorest and sickest patients who need the most help. In an effort to make Medicaid work better for its beneficiaries, state and federal policymakers must work to tackle these flaws.
At the core of Medicaid’s troubles is its provider reimbursement system, which is based on price controls. In general, it pays rates substantially less than those of private insurance and can even be less than the cost to deliver that care. According to a Kaiser Family Foundation analysis, in 2016, Medicaid reimbursed physicians across the country 72 percent of Medicare rates for all services and 66 percent of Medicare rates for primary care. In general, Medicare rates are already less than those of private insurance.
With noncompetitive reimbursement and the administrative hassle of the program, many providers are reluctant to accept Medicaid patients. Researchers at the National Center for Health Statistics found that in 2013, while 84.7 percent of office-based doctors would accept a new patient with private insurance, only 68.9 percent would accept a new patient with Medicaid.
The program’s flaws are ultimately passed along to patients in the form of restricted access, long waits for appointments, reliance on disjointed and costly emergency rooms and compromised care. A multitude of peer-reviewed research has highlighted these concerning trends. A more recent randomized, controlled study published in the New England Journal of Medicine found that two years after a patient obtained Medicaid, the program did not significantly impact their blood pressure, cholesterol or glycated hemoglobin level – a measure of Diabetic control. This research emphasizes the fundamental differences between health insurance and health care.
One obvious way to increase provider participation would be to permanently increase Medicaid reimbursement rates for outpatient physicians, in particular, primary care doctors (PCPs). This would likely give Medicaid patients increased access to the health care system and improve their care. While state and federal leaders looking at tight bottom lines, might initially be reluctant regarding such an upfront expenditure, in the long run, by decreasing costly trips to the emergency room, this policy would make Medicaid a better program and could save money.
When a Medicaid patient is sick and they have a PCP, they can schedule a visit with the PCP. Yet, without a PCP, they have few options besides going to the ER where the cost is significantly more. The same is true in a variety of other circumstances. For example, when a patient is discharged from the hospital and their condition changes or worsens, if a patient has a PCP, the patient can be reassessed and have their concerns addressed at an outpatient visit. Without a PCP, the patient is left with few choices other than to go back to the hospital with a much higher price tag.
Another way to increase provider participation in the Medicaid program would be to add greater flexibility at the local level and minimize administrative burdens. With medicine so regulated, scaling back regulations would allow providers more time and energy to focus on medicine and patient care. This would likely be appealing to providers and encourage participation in the program. In addition to improving access, this approach would likely have other broad benefits as well. Burnout and physician dissatisfaction have exploded in recent years. Allowing physicians to focus more time on patient care would likely help curb this concerning drift. It could also fuel innovation in Medicaid that would lower costs for the program, improve patient access and care. Policymakers could also explore incentives with malpractice insurance to incentivize participation in the Medicaid program.
It is important to remember that those struggling within the Medicaid program for their care are not mere statistics or academic exercises. They are a loved one – a parent, a child, a family member or a friend. The administration should work with Congress and the states to make Medicaid reform a top priority and ensure that those depending on Medicaid get the help that they need.
Jason D. Fodeman, MD, MBA is a practicing primary care physician. He specializes in delivery systems and health policy.