Medicaid study creates emergency
A study of Medicaid enrollees shows they don't act in the way health experts predicted.
People can disagree about the effect of Obamacare on our national health care systems, but there's one undeniable advantage to the robust experiment in this massive, government-directed system — it's providing answers to questions that have long been subject to a bitter public debate.
One of the vexing issues related to health care costs is, to what extent health care costs will decline if more people have insurance.
One specific question centers around the use of emergency room services by people who do not have insurance. Because they don't have insurance, they generally don't have doctors. So, before Obamacare, when those without insurance found themselves in need of any kind of medical care, including non-emergency care, they went to hospital emergency rooms the way other people visit doctor's offices.
The expenses associated with emergency room care are dramatic, and the thinking was that newly insured people would behave like those who have long been insured. And why not? It just makes sense that the newly-insured would be happy to have their own doctors and use them rather than endure the vagaries of emergency room services that include long waits in line and different doctors.
But what makes sense intuitively just isn't reality, according to the results of an Oregon study that focused on 10,000 low-income residents who obtained Medicaid coverage. The Oregon study revealed that the new Medicaid patients eschewed traditional trips to the doctor's office in favor of even more trips to the emergency room, some 40 percent more often than those without insurance.
The Oregon results are significant because Obamacare dramatically expands the number of people added to the Medicaid rolls. If Oregon's results foreshadow the experience of other states, like Illinois, it means that Obamacare costs will be dramatically higher than forecast.
The Oregon study is revealing because it set out to solve the long-standing debate about use of emergency room care by lower-income individuals and families.
In 2008, Oregon extended Medicaid coverage to 10,000 low-income residents selected by lottery from 90,000 applicants. Then it compared the health care decisions made by individuals in both groups.
"Now we know — the hope that Medicaid will save money turns out not to be true, at least in the first two years," said Amy Finkelstein, an MIT economist who is the principal investigator for the study.
The study's results, of course, are not carved in stone. Circumstances can change, most particularly including increasing the emphasis to Medicaid recipients of the importance of not going to the emergency room for non-emergency issues. At the same time, however, people's habits are hard to change, and this is one practice that's deeply ingrained among many low-income people.
The good news in the study is that the newly insured reported that they feel their physical health has improved, and depression among this core group was 30 percent lower than with the uninsured. At the same time as the newly insured reported feeling better, the study revealed that their overall health, as reflected in blood pressure, cholesterol levels and blood sugar, showed no improvement.
So perhaps seeing the doctor gives a person the sensation of being in better health than test results show to be true. Perception may be reality in some cases, but not in the case of one's health.
This study serves as another shot across the bow involving deeply held assumptions about government's ability to change personal behavior and do so in a way that reduces taxpayer costs.
Four million Americans have been added to the Medicaid rolls since the advent of Obamacare. The more devastating statistic is that 20 percent of the American population is enrolled in this hugely expensive welfare program.
As the Portland study demonstrates, finding less expensive and more efficient ways of providing health care to low-income Medicaid recipients is a much bigger challenge than even the experts believed.