By Lambert Strether of Corrente.
Hitherto, I’ve focused mostly on the ObamaCare exchanges, or the “marketplace,” because that topic is technically interesting to me, because it affects me personally, and because I think it’s the “thin end of the wedge” for future neo-liberal delivery of such social insurance as our betters deem
necessary profitable. (For example, and I grant with no evidence, I picture a “Retirement Marketplace,” with lots of 401k brochureware, and Social Security as the “public option.”) As a result, my Medicaid coverage has been limited to the unconscionable “estate recovery” clawbacks for Medicaid payments to over-55s.
However, many observers believe that ObamaCare’s success, such as it is, is due to the expansion of the existing Medicaid program, not the, er, innovative Marketplace, so it’s time to take a look at the Medicaid state of play. (I’m going to skip the King v. Burwell mess entirely.)
I’ll quickly cover three topic areas: The usual random variations in coverage, waivers, and the impending loss of Medicaid’s temporary subsides for doctors. And, because I’m lucky enough to be a little bit new to Medicaid, I’ll welcome reader commentary even more than usual, especially from those with personal experience with the program.
The Usual Random Variations in Coverage
As we showed in perhaps overmuch detail in “ObamaCare’s Relentless Creation of Second-Class Citizens” (one, two, three, four, five, six) ObamaCare creates random variations in access to care via income, age, jurisdiction, employment status, marital status, and other personal characteristics. ObamaCare, then, is in no sense and has never been, and is not designed to be, a program that provides “universal coverage.” In no sense does ObamaCare consider health care as a right. Rather, ObamaCare is a program designed to deliver health insurance to certain market segments along certain channels, some of them pre-existing, and all of them designed to reinforce the position of the private health insurance industry in the health care system. Random variation by jurisdiction is especially evident in Medicaid:
While nationally the share of Americans without health insurance declined from 20 percent in 2010 to 16 percent by the second half of 2014, a divide has opened between states that agreed to expand Medicaid and states choosing not to. Thirty-five percent of adults below the poverty line remained uninsured in states that did not expand eligibility, compared with 19 percent in states that did.
So, if you live in the wrong state, tough luck, pal. Pain City for you!
Here’s a splendid example of the luck of the draw from Pennsylvania. The Philadelphia Inquirer:
Healthy Pennsylvania was the signature plan of Gov. Corbett. His administration got the green light from the Obama administration in August 2014 to start the program. Under the program, people in the expansion are getting less coverage than current recipients [another random variation]. And the Corbett administration had also been in talks with federal officials about reducing benefits for those traditional Medicaid recipients.
For example, the letter from the state requesting the financial information also says that supplying the information is optional, said Kyle Rouse, a navigator with the Health Federation of Philadelphia.
[Kyle Rouse, a navigator with the Health Federation of Philadelphia] said a client brought the letter to him because she was confused. “It confused me as much as it confused her, because in the same letter it said the information was optional but they were requesting it.” …
What Rouse and other navigators and advocates have learned is that if their clients don’t supply that information, their application gets stalled or denied.
“The value of your bank account is irrelevant to your eligibility under the extension category,” said Kyle Fisher, a staff attorney for the Pennsylvania Health Law Project. “But practically, to get an eligibility decision as soon as possible, I would suggest that you have that information.”
Leave aside the partisan change or at least shift from a Republican governor to a Democrat in November 2014, which may improve this absurd and degrading situation where the optional is mandatory; what conceivable justification is there for a United States citizen to be subjected to this situation — where the bottom line, for some, must be the denial of needed care — because they live in Pennsylvania, and not New York or California? None that I can see.
But the random variations is, in fact nationwide, grossly obvious, and a consequence of ObamaCare’s system architecture. The Hill:
Since the court’s decision, in exchange for millions in new federal funding. States will take on an increasing share of the costs as the years pass, however, which has stoked skepticism among conservative governors.
Entirely justified skepticism, as we will see when we get to Medicaid fees.
Several states, such as Arkansas, have tweaked the rules for the Medicaid expansion with a waiver from HHS.
Colorado’s Democratic Gov. John Hickenlooper, who serves as NGA president, also said Tuesday that the waiver process should be streamlined.
“Lets make it easier to get those waivers done, and in many cases, make them permanent,” Hickenlooper said during a “State of the States” address, calling for “flexible federalism.”
“Flexible federalism” means giving local oligarchies the power to screw their locals as hard as they can. Just so we’re clear.
The meeting comes during a major momentum shift for Medicaid expansion, largely driven by hospital leaders in expansion-less states that are becoming increasingly desperate for the extra cash.
Last month, Tennessee Gov. Bill Haslam (R) took a major step toward making his state the first in the deep South to approve the expansion.
Again, what justification is there for this? Are citizens from the deep South lesser human beings, and less deserving of access to health care, than citizens in other states?
Fun and Games with Waivers
And so we come to “Section 1115.” Kaiser Health Foundation explains:
Under the Affordable Care Act (ACA), Medicaid plays a key role in efforts to reduce the number of uninsured by expanding eligibility to nearly all low income adults with incomes at or below 138% FPL ($16,105 per year for an individual in 2014); however, the Supreme Court ruling on the ACA effectively made the expansion a state option. As of November 2014, 28 states including DC are implementing the expansion. Under flexibility provided by the ACA’s Medicaid expansion, as well as pre-existing federal Medicaid law, the Medicaid expansion is being implemented differently across states in terms of what specific benefits are provided and how those services are delivered. To date, a limited number of states have obtained or are seeking approval through Section 1115 waivers to implement the expansion in ways that extend beyond the flexibility provided by the law. However, looking ahead, more states may pursue alternative models as a politically viable way to expansion in order to extend coverage and capture federal dollars.
Ah yes, “politically viable.” Too bad the Democrats blew it — assuming good faith — in 2008 – 2009, but perhaps they will figure out how not to suck in 2016. There’s always hope!
[Tennessee governor Bill Haslam’s] proposal would rely on two separate plans for anyone above 20 (those younger would stay in a traditional, public insurance program): the Volunteer Plan and the Health Incentives Plan.
The Volunteer Plan is what is especially different about Haslam’s proposal: it would use Medicaid dollars to help low-income workers who qualify for Medicaid through their employer instead. Instead of having the worker contribute a premium, the state would step in to cover all or part of the monthly premium….
This is not something any other state has proposed to the Obama administration, and it could be controversial. It’s [profit; administration, CEO bonuses] typically does (Medicaid, for example, often covers transportation to the doctor, a benefit that does not turn up in private coverage). Tennessee says it wants permission to put Medicaid enrollees in plans, then, that do not cover all Medicaid benefits. It’s not clear that the Obama administration would be on board with this.
The second program, the Health Incentives Plan, . It adds in co-payments and premiums (the lowest-income Tennesseans would be exempt, and there are caps on how much an enrollee could spend). Plan members could also lower their costs by participating in “healthy behaviors.”
So, in essence, Tennessee wants to privatize and crapify Medicaid as much as it can, and is asking for a waiver to do it. Since that is perfectly aligned with the Obama administrations larger goals, not to say worldview, no doubt the waiver will be granted. Yay!
Loss of Temporary Medicaid Subsidies
The mind reels at this one. Here’s the set-up. Forbes:
Obamacare increased Medicaid reimbursement rates for primary care physicians to Medicare levels—but only for two years, 2013 and 2014.
“Only for two years.” Shenanigans like this is why Red State governors aren’t utterly insane not to trust the Feds never to cut their subsidies.
And yet one of the primary ways Democrats planned to increase the number of insured under Obamacare was by expanding Medicaid to millions more. In order to stifle opposition from physicians and states to their Medicaid expansion, Democrats drafting Obamacare included a two-year bribe to buy support. That increase just expired and lower Medicaid reimbursement rates are back.
So how low the lower reimbursement rates go? How bad are the cuts? They are very bad. Urban Institute:
Overall, primary care fees in the Medicaid program would fall an average of 42.8 percent in 2015 if no extension of the ACA primary care fee increase policy were granted. The fee reduction would be even larger — 47.4 percent on average — in those states that do not plan to extend the fee bump using state funds. To put the magnitude of these fee reductions in some context, consider that the projected Medicare fee reduction under the sustainable growth rate formula was 24 percent in 2014. …
And cuts in reimbursement will almost certainly lead to cuts in the delivery of care:
[S]ignificant drops in primary care reimbursement may lead physicians to see fewer Medicaid patients, potentially leading these patients to have difficulty finding a physician or getting an appointment. Although payment is not the only factor in physician acceptance of Medicaid (Long 2013), research has demonstrated a correlation between lower payment rates and fewer physicians accepting new Medicaid patients (Decker 2012).
I’m just shaking my head at this. New York Times:
Just as millions of people are gaining insurance through Medicaid, the program is poised to make deep cuts in payments to many doctors, prompting some physicians and consumer advocates to warn that the reductions could make it more difficult for Medicaid patients to obtain care.
Dr. George J. Petruncio, a family physician in Turnersville, N.J., described the cuts as a “bait and switch” move. “The government attempted to entice physicians into Medicaid with higher rates, then lowers reimbursement once the doctors are involved,” he said.
Again, shaking my head. Democrats get doctors and patients into the program — and go all triumphalist at the enrollment numbers! — and then after two years, they pull the rug out. Sorry, no more Medicaid for you! What conceivable justification for this cruel bait and switch can there be? I can’t even come up with a Machiavellian one.
It’s almost as if the Obama administration was bound and determined to prove that government can’t do anything right (except shovel loot into the coffers of the 1% as fast as they can, of course. But that’s bipartisan).
 To be fair, the entire Obama administration has been a bait and switch of colossal proportions. So there’s that.