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).

Thanks to these concerns, doctors around the country are giving
Medicaid patients the boot. In states like Michigan the proportion of
doctors who will see Medicaid patients has fallen from 88 percent in
1999 to 64 percent in 2005, even though enrollment in the state’s
Medicaid program has risen by more than 50 percent over this period. In
Texas,
more than 60 percent of Texas doctors refuse to accept new Medicaid
patients. Last year in Illinois, two clinics engaged in a messy legal battle with the state’s Attorney General to defend their right to refuse long-term care to Medicaid patients.

Closing doors to Medicaid patients can have some ugly consequences,
such as increased use of emergency rooms for routine care, itself a
major problem that I discussed last month. It also makes stories like that of Deamonte Driver more likely. Driver was a twelve-year old Maryland boy who died
of a toothache last year because his family couldn’t find a dentist
willing to accept Medicaid. His life could have been saved via a
simple, $80 procedure—but without access to a provider, even under
Medicaid, he couldn’t find someone to perform that procedure. So he
died. 

Driver’s story may grow more common as the number of Medicaid doctors
shrinks and the number of Medicaid enrollees nationwide swells. In a report
released on Monday, the Kaiser Foundation calculated that the average
growth of Medicaid enrollment across the nation was 2.1 percent in
fiscal year 2008, and that it’s set to grow another 3.6 percent in FY
2009 (perhaps even more, as economic conditions worsen).

But access isn’t the only problem: even when Medicaid patients do get care, it tends to be sub-par. Last October, a study
from Harvard Medical School compared the quality of care between
Medicaid and commercial managed care plans and found that “Medicaid
managed care enrollees receive lower-quality care than that received by
commercial managed care enrollees.” The authors looked at information
on 11 quality measures from 383 health plans that reported
quality-of-care data to the National Committee for Quality Assurance
for 2002 and 2003. Their sample included 204 commercial-only plans, 142
mixed Medicaid/commercial plans and 37 Medicaid-only plans. The 11
indicators covered areas of prevention and screening, chronic disease
management and care for pregnant women. Among the findings:

• Timely prenatal care was delivered to 86.9% of patients in
  commercial plans versus 69.4% of patients in Medicaid plans. For
  postpartum care the difference was more striking, 77.2% versus 40.7%.
• Recommended breast cancer screening was completed for 52.6% of Medicaid patients versus 75.1% of commercial HMO patients.
• Blood sugar was tested in 73.4% of Medicaid patients with
  diabetes and glucose controlled in 47.4% of Medicaid patients—compared
  with 82.6% and 66.3%, respectively, for diabetic patients enrolled in
  commercial plans.
• The childhood immunization rate was 54% in the Medicaid plans and 68.7% for commercial plan enrollees.

Other studies confirm the troubling disparities between Medicaid patients and everyone else. A recent study in the Journal of the American College of Surgeons
found that patients who undergo colon cancer surgery in hospitals where
more than 40 percent of patients are on Medicaid have a higher risk of
death at 30 days and 1 year after surgery than patients treated at
other hospitals. Researchers believe that this association “is somehow
related to resource limitation common to hospitals with heavy Medicaid
payor mix”—in other words, hospitals that serve the poor are usually
poor themselves, or are inadequately staffed, and are thus more likely
to provide sub-par treatments.

Even kids aren’t safe. In 2002, researchers from Boston’s Children Hospital found
that children with Medicaid insurance have a higher risk of dying after
congenital heart surgery than those with commercial insurance because
referral patterns often sent them to hospitals with less-than-stellar
outcomes records. This, of course, makes sense: in-demand doctors with
a high volume of patients don’t need to squeeze in sure-fire money
losers like Medicaid patients—leaving low-income patients to find their
way to less popular, and probably less skilled, doctors. This is a
troubling dynamic, especially given the fact that Medicaid pays fully one-half of the national hospital bill for children with congenital heart defects.

Further, back in 2001, researchers from Harvard Medical School found
that kids with chronic conditions don’t receive recommended care under
Medicaid. These low-income children disproportionately rely on primary
care physicians instead of specialists for their care, even though
these kids “need both high-quality primary care and up-to-date
subspecialty care for the optimal management of their chronic
condition.” While we should always be wary of going over-board with
specialty care, there are still complex chronic conditions (e.g.
asthma, hemophilia, cerebral palsy) that demand “higher rates of
relevant subspecialty utilization.” Yet the researchers found that
“rates of subspecialty use rose only marginally” amongst children who
were Medicaid enrollees. Many specialists just won’t take Medicaid
patients.

So why is the quality of Medicaid care consistently lower? The greatest
predictor of health in the U.S. is socioeconomic status, meaning that
Medicaid, on the whole, deals with some of the least healthy Americans.
But with reimbursement rates so low, top docs at flush institutions are
less likely to see Medicaid patients (because they can make a lot more
money seeing other sorts of patients)—and so you have the sickest
patients going to less proven, and often less skilled, doctors. Even at
academic medical centers there are often two clinics: one for patients
with insurance, who are seen by the center’s top doctors, and a second
clinic for patient on Medicaid and the uninsured, who are seen by
residents.

State rules about eligibility and enrollment also can make it very
difficult for low-income patients to qualify for Medicaid.  Many states
have specific requirements for Medicaid eligibility that go beyond
income, such as having children or being disabled, that make the
medical equation even more complicated. (In these states adults with
families are considered among the “worthy poor;” childless adults are
viewed as somehow less deserving—an enormous problem for homosexual men
suffering from AIDS.)

In some states, only the sickest patients can actually get Medicaid
coverage when they need it.  For example, the American Cancer Society
(ACS) notes that in Michigan, “adults who are not pregnant or caring
for young children” must be suffering from a disabling condition
expected to last [at least] one year before enrolling.  This helps
explains why,  when ACS looked
at 13,740  Michigan adults who suffered from 3 common forms of cancer
in 2004, it found that Medicaid enrollees had a two to three times
greater risk of death when compared  to non-Medicaid patients—even
after controlling for site and stage of cancer: about 40 percent of Medicaid cancer patients in the
study sample enrolled in Medicaid only after being diagnosed with
late-stage cancer.

Until they were diagnosed, these patients couldn’t prove that
they suffered from a disease that would last at least one year—and thus
qualify for Medicaid. But, the ACS study points out, “if cancer is a
Medicaid enrollee’s qualifying disabling condition, then the cancer, by
definition, has to be advanced. Treatments, even if they are state of
the art, for late-stage cancers are less likely to offer prolonged
survival benefits.” When you hold out health care until patients are
very sick, health outcomes are likely to be worse. 

It’s hard to disagree with the fact that Medicaid leaves much to be
desired—and that the program is proof that, just because you have
health insurance, doesn’t mean that you have access to good health
care. This fact makes blind expansion of Medicaid a less than ideal
strategy for reform: sure, we can cover more people, but if they can’t
find good doctors—or if the care they receive is sub-par—than we’re
only fighting half the battle.

So what is a smart strategy for Medicaid reform? I’ll tackle that in Part II of this post.

Look for more on Medicaid from Health Beat in the future as well—we
think this a topic that doesn’t get nearly as much attention as it
deserves.