By Adam Gaffney, MD
USA Today, July 7, 2014
Traditional Medicaid will remain a crucial safety net
Living in poverty is hard enough; having to face sickness without insurance while doing so is a fate no one should bear.
By expanding Medicaid to all earning less than 138% of the poverty level, the Affordable Care Act will help many avoid this outcome. Unfortunately, the Supreme Court ruled that states can opt out of the expansion, and 24 states have done that. Arkansas and Iowa, on the other hand, have won federal waivers to pursue a “private option” as a compromise, and other states may follow.
Private option Medicaid would give low-income families vouchers to purchase private insurance, instead of enrolling them in traditional Medicaid.
Why is that a problem?
- First, private option plans impose new co-pays for doctor visits and medications on the dubious premise that patients need more “skin in the game.” But co-pays often deter vital care: Heart attack victims delay coming to the ER, or children forgo asthma medicines. And co-pays are especially hard on low-income families.
- Second, the private option is inefficient. Insurers have much higher overhead than public programs such as Medicaid or Medicare. Privatized “Medicare Advantage” plans take more than 13% for overhead (traditional Medicare is closer to 2%), gaining large profits at taxpayer expense.
The private option has also been used to make stealth benefit cuts: Iowa’s plan eliminates the transportation benefit that helps patients get to treatments such as dialysis.
Medicaid is far from perfect, but the private option won’t be an improvement. Medicaid patients, for instance, often have trouble finding doctors. But private option Medicaid plans, like many plans on the health exchanges, have very narrow doctor and hospital networks.
“Churning” is another problem: Families must often change providers as they move in and out of Medicaid eligibility. But churning will persist under the private option as people change jobs or plans change provider networks.
To truly address Medicaid’s problems, we need a universal single-payer system. But until that is achieved, traditional Medicaid will remain a crucial safety net. We must fight to expand it, but also to protect it.
Adam Gaffney is a physician and writer in Massachusetts who blogs at theprogressivephysician.org.
