In theory, Medicaid ensures that low-income families receive health care. But in practice, the program leaves much to be desired—and serves as a painful illustration that the existence of an insurance program isn’t enough to ensure access to necessary care.
On paper Medicaid offers pretty comprehensive coverage, seemingly even better than Medicare. For example, Medicaid covers long-term care for the elderly, nursing home care, and offers broader prescription drug benefits than Medicare.
But all the benefits don’t mean a thing if patients can’t find doctors to provide them. In a post last November, I noted that reimbursement rates for Medicaid are abysmally low across the nation as compared to both private insurance and Medicare: in New York, doctors receive $20 for an hour-long consultation with Medicaid patients, whereas a physician could earn almost $200—about 10 times as much—for such a consultation under Medicare. In 2007, the Wall Street Journal reported that Michigan’s Medicaid program pays $20 for a chest x-ray, where as Medicare pays $30 and private insurer Blue Cross, $33. For performing an appendectomy, a Michigan doctor can expect $784 from Blue Cross and just $336—about 42 percent as much—from Medicaid.
There’s nothing inherently easier about treating poor people—in fact,
Americans stuck on the lowest rungs of our socioeconomic ladder tend to
be in poorer health. Yet doctors are paid less under Medicaid and as a
result are closing their doors to low-income patients: a 2006 Center
for Studying Health Care System Change report found that the percentage
of physicians who accepted no new Medicaid patients in 2004-2005 was
“six times higher than for Medicare patients and five times higher than
for privately insured patients.” Reimbursement was a major concern
here: 84 percent of physicians who did not accept new Medicaid patients
in 2004-2005 said reimbursements were a factor; 70 percent of
physicians said billing requirements and paperwork were a factor; and
two-thirds said delayed payments were a factor. (While Medicare, a
federal program, has a reputation for paying providers in a timely
manner, Medicaid—administered by states—is a much more haphazard
affair, and can leave doctors waiting for months).