Expanding Medicaid Is Not Enough–Making Medicaid A Federal Program

 Note to readers—please read the post below, “Pulse—More Stories from the Heart of Medicine” (which includes “One More Child Left Behind”) before you read this post.

When I read “One More Child Left Behind,”  all I could think of was how much Aaron’s arm must have hurt during the more than 24 hours that he didn’t receive treatment. I also imagined how frightened and bewildered the six-year-old must have been as he heard his mother and grandmother talk, and realized that they couldn’t persuade a doctor to help him.

This story was published in 2009—one year before the Affordable Care Act was passed.  The ACA extends Medicaid to millions. But even under reform legislation, many children like Aaron will not receive care. This is because Medicaid now pays an average of 34% less than Medicare for exactly the same treatment.

Why on earth would we pay doctors and hospital less to care for poor patients than we would pay them to care for the elderly?

Lower Medicaid fees are part of the legacy of racism. (I write about this in Money-Driven Medicine.)  When the Medicare and Medicaid laws were passed in 1965, Southern Congressmen refused to agree to laws that would pay doctors who treated the poor as much as they reimburse physicians who care for older patients.

At the time, relatively few African-Americans living in the South were over 65.  Most died long before they would be eligible for Medicare. Yet many African-Americans were poor, and would qualify for Medicaid. This is what disturbed Southern legislators. They wanted to make sure that healthcare remained segregated.    

Even under Reform, Specialists Who Treat the Poor Will be Under-Paid   

Medicaid rates vary widely by state, but on average, according to the Kaiser Family Foundation, the new program will offer PCP’s a 73 percent raise This should open doors for millions of Medicaid patients. In some states that have been paying the lowest rates, the hike will be much higher. (See this map) The ACA guarantees raising Medicaid reimbursements for primary care for just two years (2013-2014). But I expect this program will be extended, although increases may be modified. Once begun, it will be very hard to justify ending it.

At the same time, specialists who care for Medicaid patients will continue to receive about 1/3 less than when treating seniors.  As a result, even under the ACA a great many Medicaid patients will be hard-pressed to find a specialist willing to see them.

A 2011 study published in the New England Journal of Medicine reveals that when researchers called specialty clinics posing as mothers looking for care for their children and said that they were covered by Medicaid-CHIP, 66% of the callers were denied an appointment. When researchers called the same clinics, and said the child was covered by private insurance only 11% were turned away.) Among 89 clinics that accepted both insurance types, the average wait time for Medicaid–CHIP enrollees was 22 days longer than that for privately insured children.

A second 2011 study investigating access to orthopedic care for children found that timely access was available in 100% of the offices polled if the child had private insurance, vs. 2% of the child was on Medi-Cal (California’s version of Medicaid.) “This is a significant difference,” researchers noted.  “Lack of timely orthopedic care may result in poor outcomes, ie, if a fracture is not properly aligned in the first few weeks, a permanent deformity may result.”

If the child’s parents took him to an ER, wouldn’t a physician have to treat him? No, by law an ER is required only to “stabilize” a patient, not to treat him.  Moreover, as Aaron’s story reveals, if an orthopedist is not present in the ER, and a specialist qualfiied to handle the case is not “on call,” no one would required to come in. 

                Do Physicians Have a Moral Obligation to Treat Medicaid Patients?

Should specialists  accept patients like Aaron, even if they are paid so much less? \U

I would hope they would. Though rather than talking about a moral obligation, I would prefer to call it a “professional” obligation to see at least some Medicaid patients.

But if we expect physicians to care about children like Aaron, what about the rest of us? Don’t we as a society, have an obligation to pay physicians who treat the poor as much as we pay those who treat the wealthy?  (Granted, in some cases we over-pay providers who care for well-insured patients.  My point is simply that reimbursements to all physicians should be based on the value of the care they provide– not  who the patient is.)   

Moreover, as “One More Child Left Behind” illustrates, doctors themselves rarely are making case-by-case or face-to face decisions.  The physicians who were contacted didn’t see Aaron. Instead, a receptionist took the call, and he or she had been told: “We do not take patients covered by this [Medicaid] insurer.”

I understand why many doctors feel they cannot afford to treat a large number of Medicaid patients. But as Medicaid expands, I wish that more specialists would tell their receptionists that they are willing to see a small number of new Medicaid patients each month. 

Still, that’s only a stop-gap measure. Ultimately, reimbursements for Medicaid providers must be raised.

Converting Medicaid into a Federal Program– One Payment Schedule for Both Medicare and Medicaid

Ultimately, I believe that Medicaid should become a federal program, administered by the Centers for Medicare and Medicaid (CMS), alongside Medicare, with one pay schedule for all providers.

If Washington took over Medicaid, CMS would enjoy economies of scale; administrative costs would be lower. And the Federal government is in a better position than the states to investigate fraud, using FBI raids to gather evidence, much as it has when uncovering Medicare fraud at hospital chains like Tenet.

States would be asked to contribute to a federal Medicaid program.  No doubt the formula determining how much a state should kick in would be complicated. But it should begin with the amount that  a state now spends on Medicaid, and, perhpas, factor in taxable resources per capita in that state.

The federal government already has pledged to cover 100% of the costs of Medicaid expansion from 2014 to 2016. In the years that follow, its contribution falls slowly. In 2020, Washington’s share will reach 90%–and stay there. At that point, if Medicaid were a federal program, state contributions would rise to cover just 10% of the cost of new enrollees.

Over time, a state’s contributions also would have to climb to reflect inflation, but using a formula tied to the consumer price index (CPI), not health care inflation. (One goal of reform is to make sure that health care prices are not rising faster than prices in other parts of the economy.)

States would be expected to pay into a federal Medicaid program because Medicaid funds would continue to contribute to a state’s economy, creating jobs and funding public hospitals. At the same time, states would be relieved of the burden of trying to reform what is now a dysfunctional program.  (To be fair, today, some extremely poor states just cannot afford to run a decent Medicaid program.  Others lack the will.)  

As we reform payments to providers, reimbursements should reflect how much the treatment helps the patient. A doctor would be as well-paid to set the shattered arm of a six–year old as he is to treat the fractured arm of a sixty-six -year old.

                  Finding the Money to Fund Higher Payments for Medicaid Providers

How could we afford to hike reimbursements for those who care for Medicaid patients? By following the National Commission on Physician Payment Reform’s recent recommendations on physician pay.

Earlier this month the Commission, (chaired by Dr. Steven Schroeder, Distinguished Professor of Health and Health, at the University of California, San Francisco and former President and CEO of the Robert Wood Johnson Foundation, along with  former Republican Senator Majority Leader Dr. Bill Frist,)  issued a  spot-on blueprint for overhauling how we pay physicians. / 

If Medicare followed this model, it would reduce overpayments in some of the most expensive areas of care.  The savings that follow from these fundamental reforms would be enormous. The Centers for Medicare and Medicaid could then use at least part of the money saved to boost pay for physicians who are underpaid–including those specialists who care for Medicaid patients. 

It is worth noting that under the Affordable Care Act, the Secretary of HHS already is given the power to lower reimbursements for “over-valued services” while raising reimbursements for “undervalued services.” If Medicaid became a federal program, all of the recommendations below would apply equally to Medicaid and Medicare.

— “Include a component of quality or outcome-based performance reimbursement in all fee-for-service contracts.  UnitedHealthcare reports that depends in part on their meeting quality measures — have significantly lowered complication rates for the 250,000 physicians participating in its Premium Designation program — whose compensation stent placement procedures and knee arthroscopic surgery, and have 14 percent lower costs, than specialists not in the program.  WellPoint has obtained similar results in its pilot programs.

–“Increase reimbursement for evaluation and management (E&M) services. The current fee-for-service system places a higher value on high-technology care than preventive measures.  . . . .annual updates should be increased for evaluation and management codes, which are currently undervalued. Updates for procedural diagnosis codes, which are generally overvalued and thus create incentives for overuse, should be frozen for a period of three years. During this time period, efforts should continue to improve the accuracy of relative values, which may result in some increases as well as some decreases in payments for specific services. 

“The undervalued evaluation and management services at issue are often those that provide preventive health and wellness care, address new or undiagnosed problems, and manage chronic illnesses. The current skewed physician payment system causes a number of problems, such as creating a disincentive to spend time with patients with complex chronic conditions; leading physicians to offer care for highly reimbursed procedures rather than lower-reimbursed cognitive care; and neglecting illness prevention and disease management. High reimbursement for procedures also subtly nudges specialists such as gastroenterologists and pulmonologists away from E&M services and toward doing procedures.  

“Moreover, physicians doing diagnostic or therapeutic procedures earn considerably more than physicians who mainly evaluate and manage patients — even those with multiple chronic conditions.  In 2011, a radiologist, on average, earned $315,000 a year, while a family doctor on average earned $158,000. This has led medical students — many of whom leave school heavily in debt — away from the E&M specialties and toward the higher paying procedural and imaging specialties.”

–The report stresses that paying more for E&M services should not be limited to boosting reimbursements to primary care physicians: “the real issue is not one of relative payment of specialists versus primary care physicians but, rather, of payment for E&M services as contrasted with procedural services.  These include E&M services provided by, among others, cardiologists, endocrinologists, hematologists, infectious disease specialists, neurologists, psychiatrists, and rheumatologists.

 —  “Eliminate higher payment for facility-based services that can be performed in a lower-cost setting.  Recently, there has been a trend to reimburse medical services performed in outpatient facilities at a lower rate than those same services when provided in hospitals. For example, Medicare pays $450 for an echocardiogram done in a hospital and only $180 for the same procedure in a physician’s office. It makes no sense to pay extra for an in-hospital procedure that can be done more cheaply in an ambulatory facility.”

        Would Republicans Consider Letting Medicaid Become a Federal Program?

No doubt, deficit hawks would fret that if the federal government took responsibility for Medicaid, this would contribute to the federal deficit. But in fact, we are “one nation:. Whether the federal government runs a deficit or states face a shortfall, taxes are likely to go up because the federal government will wind up increasing aid to the states.

Indeed, as a result of the Great Recession that began in 2008, 2011 became the first year that federal aid became  the largest component of state revenues. . . .  While state revenues have declined during this recession, debt-financed federal aid has risen. Nationwide it now stands at more than one third of total state revenues

Most States are not allowed to run deficits. They must balance their budgets. This might sound like fiscal discipline, but in fact it leads to spending cuts that hurt the economy as a whole. In recent years, as states have struggled to close budget gaps, this has led to downsizing “that has cost us hundreds of thousands of jobs, undermining  education, health care,” and other priorities that we as a nation shares the Center for Budget Policy and Priorities (CBPP) observes. “These cuts have helped delay the recovery.”  

 By contrast, as the New America Foundation’s Michael Lind points out “ during severe economic crisis, completely federal social insurance programs like Social Security and Medicare have a greater stabilizing effect on the macro-economy than partly-federal, partly-state-based social insurance programs like Medicaid and unemployment insurance.

                                     What We Can Do Now?                         

I realize that turning  Medicaid iinto a federal program is not something that will happen tomorrow. It would have to be done in steps, probably beginning with “dual-eligibles”—people who qualify both for Medicare and for Medicaid.

Under the Affordable Care Act, CMS will begin paying for Quality.  Here I would suggest that s roviders seeking bonuses  for “better care”– whether by creating Accountable Care Organizations or by forming “medical homes”– might be asked to show that they treat a certain percentage of Medicaid patients.  If a specialist or hospital hopes to earn more by providing high quality care, a willingness to treat the poor could become  one measure of a provider’s commitment to improving  American healthcare. 

Of course, some hospitals and many specialists are located in neighborhoods where there are few poor patients.  But Medicaid could provide bus fare or other transportation to take Medicaid patients to specialists and hospitals outside of the neighborhoods where they live. If we want the poor to enjoy the same standard of care that others receive, we must move away from segregated acute care. 

Finally, as both I and my former HealthBeat partner, Naomi Freundlich, have argued in the past, non-profit hospitals that shun the poor (and some do), should begin paying property taxes.

7 thoughts on “Expanding Medicaid Is Not Enough–Making Medicaid A Federal Program

  1. All good points, and all things that should have happened years ago.

    Some mild dissent:

    First, after thinking about this for years, I have concluded that not only should Medicaid be federalized, but that states should not be required to contribute. As Maggie points out, many state budgets are in a chaotic mess, with debt obligations that are restricting spending not just on health care but also on education, infrastructure, poverty issues, law enforcement (especially on programs designed to do more than clap people in jail,) and so on. Medicaid is usually the second largest obligation in state budgets, following education, and in some states is the largest. Spending on Medicaid also tends to be anti-cyclical, with costs increasing in economic hard times, just when state tax collections are plunging. Relieving states of this obligation would provide them with budget wherewithal to do other things. In addition, the relief would tend to benefit states that have made a sincere effort to care for their citizens more than states that have neglected low income people. The potential relief for state budgets would also provide a powerful incentive — and a powerful lobbying force — pushing conservatives to support the program.

    Second, in addition to the issue of racism as the root for Medicaid’s low payments, there is another important issue. The funding from Medicaid was initially felt to be “found money” for health care providers, paying them a low payment for services they were used to providing for free.

    I entered the medical profession after the beginning of Medicare and Medicaid, but not long after, so I knew large numbers of doctors and health administrators who had worked in the era of “charity care.” In most small towns and cities, doctors and hospitals felt an obligation to care for patients who were part of their community regardless of ability to pay, and many provided as much as 25-35% of their services for free. In small towns and cities, hospitals did the same. In large cities, “charity” hospital systems, often staffed by a mix of doctors in training and academic physicians, provided for this care, and religiously affiliated hospitals also provided a large amount of free care. Most university affiliated hospitals also provided care on a “pay what you can” basis.

    For doctors and administrators used to this, the low fees from Medicaid were free money. Medicare was even better. Patients who had previously been charity cases now had the dignity of being paying customers.

    However, times have changed, and very few now remember that period. Resentment toward patients in public insurance programs has increased to the point where it is now an issue. The story of Aaron occurs in Connecticut, but is even worse and more common in other states where Medicaid payments are even lower.

  2. Pat S.

    While I agree with you conceptually, there are a few issues that need to be sorted out. First, how would you define the benefits package that would apply nationwide as there is now considerable variance in benefits among the states? New York is, by far, the most expensive Medicaid program in the country even though its population is little more than half that of California. NY’s benefit package is very comprehensive but the program is also considered wasteful with, probably, more than its share of fraud.

    As I’m sure you know, roundly 70% of Medicaid spending is on the aged, blind and disabled including slightly less than 10 million people who are eligible for both Medicare and Medicaid (dual-eligibles). The dual-eligibles account for about $300 billion of annual spending between Medicare and Medicaid. Interestingly, if you look at the 10% of duals who are most expensive for Medicare and the 10% who are most expensive for Medicaid, you would find very little overlap. The big Medicaid spenders are largely receiving long term custodial care while the Medicare high utilizers need a lot of recurring hospital based care for conditions ranging from CHF to mental illness. Medicare doesn’t cover long term care except under very limited circumstances following at least a three consecutive day hospital inpatient stay and then only for a maximum of 100 days with 20% coinsurance for days 21-100.

    Raising Medicaid’s payment rates to the Medicare level would be expensive and could raise program costs by a meaningful amount even if the states continued to pay their current share of program costs. If the states were relieved of their obligation completely, state taxes probably wouldn’t decline much if at all. The freed up money would probably be used for everything from catching up on funding retiree pension and health benefits to restoring money previously cut from higher education to pent up demand for infrastructure repair and modernization to, I fear, further increasing pay for powerful union members like teachers and police when there are already lots of qualified applicants for most of these openings even when the economy is booming.

    So, progressives who advocate this approach should, I think, be honest enough to be upfront about the need for higher taxes from more than just the top 1% or 2% of the income distribution. Compassion, fairness and social justice are nice concepts but they need to be paid for and there aren’t anywhere near enough rich people to come close to footing the bill.

  3. Pat S.–
    Very good to hear from youl

    On whether states should conribute to Medicaid:
    I see one very good reason for asking the Federal gov’t to foot the entire bill for Medicaid, without asking for contributions from the states: Federal income taxes (which would wind up paying for a least part of the added cost) are much more progressive than State and local taxes: Low income and middle-income families pay far more in state and local taxes than they pay in Federal income taxes.

    In addition, I would like to think that you are right–that if states didn’t have to contribute to Medicaid, they would do what you suggest:
    spend on “education, infrastructure, poverty issues, law enforcement (especially on programs designed to do more than clap people in jail..”

    Unfortunately, even if you look at state budgets in good times, this is not how most states are inclined to use surpluses.

    A first priority, for many governors and state legislatures is to lower income taxes , property taxes and taxes on businesses. Their wealthiest citizens favor these cuts and their wealthiest citizens provide the campaign contributions that get them elected.
    This year, many states are running surpluses (sales tax collections up; income tax collections up, oil revenues.) What are they doing with the money?
    “With a $500 million budget surplus and $2 billion in reserves, Indiana Governor-elect Mike Pence has pledged to give back some of that money when he takes office next week by cutting personal income tax–. . . ‘ reducing the tax burden on our taxpayers and businesses.'”
    InIowa “, many Republicans, like Pence, are seeking income tax cuts, including Governor Terry Branstad and the House Speaker as well commerical property tax relief.”
    “In Michigan of its surplus will offset the impact of sweeping tax changes in 2011 . . that slashed taxes on corporations by 1.8 billion.”
    Texas which has a $2 billion surplus will use part of its surplus to increase spending on education only if the state loses in court where school districts are suing the state.
    Louisiana governor Bobby Jindal wants to eliminate his State’s income tax and corporate tax (He wants to hike the sales tax by 4%)
    North Dakota has been making money on oil. The governor does want to invest in infrastructure, but he too wants to cut property and income taxes.
    In Ohio lawmakers want to use their surprlus to replenish their rainy day fund. “Ohio law requires any surplus left over after the rainy-day fund has been replenished to be used to reduce personal income-tax rates, . . .
    Ohio’s last budget cut $1.6 billion in education funding. but now that the state has as surplus, the governor would restore only about three-fourths of that amount. . .
    I could go on . . .
    States have favored cutting taxes rather than spending on the poor for a long, long time.
    “With the enactment of the Personal Responsibility and Work Opportunity Act (PRWOA) in 1996, President Bill Clinton signed into law a process of welfare “reform” which has been responsible for removing thousands of people from “welfare as we know it.” While 14.2 million people received welfare cash assistance in early 1994, by mid-1999 that number had fallen to 6.9 million. As a result of the drastic drop in caseloads, many states have accumulated substantial Temporary Aid to Needy Families (TANF) surpluses” How did they spend the money? Not on education, not on infrastructure, but on “Property tax relief. . . money that was allocated to fund programs for the poor is being diverted for tax breaks and other measures that benefit the middle class and the wealthy”
    Regarding state spending on education: When it comes to spending on education, states tend to ;pour money into their wealthiest districts while spending less on poorer children.
    A recent CAP report looked at six states ir—Illinois, Missouri, New York, North Carolina, Pennsylvania, and Texas—and found that “children in higher-poverty school districts receiving far less access to state and local funding than children in lower-poverty districts.What makes these patterns more offensive is that each of these states is taking billions of statewide taxpayer dollars and channeling them back to lower-poverty districts, which are much less in need of state funding support.”
    After focusing on those eight states, the report goes on to explain that “nationwide state financing of education” is extremely inequitable.http://www.americanprogress.org/issues/education/report/2012/09/19/38189/the-stealth-inequities-of-school-funding/
    Of course some would argue that how much we spend per pupil really doesn’t matter– money doesn’t translate into better educaiton. This report shows that simply isn’t true. http://www.nationaljournal.com/thenextamerica/education/analysis-how-much-states-spend-on-their-kids-really-does-matter-20121016

    I wrote about state budgets and state spending back when i was at Barron’s in the late 1980s and 1990s and discovered a huge amount of graft and corruption in state spending. Of course, there is plenty of “pork” in Washington, but it’s easier to hide graft at the state level.

    National reporters are much more aggressive than reporters who cover a state or a city. Local reporters who cover “Albany” (New York), for instance, must maintain a good relationship with Albany politicians. (This is the trouble with being a “beat” reporter.) If Albany won’t talk to them, they can’t say, okay, I guess I’ll write about New Hampshire instead. Reporters who cover a much larger national “beat” are not nearly as dependent on their sources.

    Finally– and this is the most important argument– At the state level, this country has become increasingly conservative. See this story: http://www.theatlantic.com/politics/archive/2011/03/the-conservative-states-of-america/71827/
    Another 2012 Atlantic article explains why at the state level, the U.S. is seeing a clear shift to the right. http://www.theatlantic.com/politics/archive/2011/03/the-conservative-states-of-america/71827/
    The two most important factors: religion and education. As fewer U.S. citizens receive a four-year college education, the citizens of many states have become more parochial, and more conservative. (These tend to be the the states where people are poorer, and the state does not invest in education K-12 — or in its state colleges. Give people less education, and they base their beliefs on emotion, conventional wisdom and local prejudices)

    It might seem that Washington also has becom more conservative over the past couple of decades. But the fact is that Obama was elected and then re-elected. Democrats have held onto at least half of Congress.
    And while GWB won two elections, the consensus is that he had to steal one of them. He won the other one by a very narrow margin.
    Before that, we had 8 years of a Democratic administration.
    The outlook for Hillary four years from now is good. (If not Hillary, another Democrat. The polls haven’t turned up a really strong Republican candidate.

    At this point, the difference between the aims of federal govenrment and state governments have changed

    So if we’re hoping that government will spend money in a progressive way– investing in human capital, and infrastructure in ways that will build the wealth of the nation, we’re better off insisting that states send that Medicaid money to Washington.

    Finall, a purely practical matter: If the Federal government took over Medicaid, we would have to raise federal income taxes– or create a special payroll tax.
    These days it is very, very difficult to raise federal income taxes and if we do (which we should) we desperately need the money to address problems ranging from global warming to hunger (food stamps) to other programs that only the federal government can (or is likely to) pursue,

    As for getting conservative support for federalizing Medicaid: many governors would be willing to send what they are now spending on Medicaid to Washington. They assume that
    Medicaid will only become more expensive in the years ahead. (And if will if we leave it to the states to run and manage it.

    While Medicare, which is a federal program, is extremely wasteful, when compared to Medicaid, there is much less fraud and waste in Medciare. And Medicare is already getting better.

  4. Pat–
    Regarding why Medicaid rates are so low. You suggest that before Medicaid, many physicians provdided care to poor patients at no cost or very low cost. This is true–for white patients. Black patients didn’t get much charity care.

    Particuarly in the South, poor black patients didn’t receive charity care from doctors, or hospitals. One study done in Selma Albama “where there were almost identical numbers of white famlies living in poverty as black families living in poverty” in 1963 (before Medicaid) showed that while 70% of white babies were born in a hospital, only 1% of black babies were born at a hospital. . .
    “It is in this historical context that Toni Morrison sets the scene of her novel Song of Solomon. The opening pages are set outside of a charity hospital in Michigan in the early 1930’s, with a pregnant black woman threatening to give birth on the very stoop of the building. . . until this point, no black woman has been allowed to deliver a child inside, evidence of the limited health care available for African-Americans in this time period. . . . The very mission of Mercy Hospital is called into question, as the so-called “charity hospital” denies African-Americans access to its services. Compounding the contradiction is the hospital’s location in a black neighborhood, where the dire need for such services surrounds it.” “Black mothers were disproportionately denied prenatal are or nuttiritonal counseling . . as a result they babies were smaller, more respiratory problems . .
    “White doctors frequently shunned black patients . . ” (This is from a book titled: “Poor People’s Medicine: Medicaid and American Charity Care)
    In 1956 in the South, only 6% of hospitals offered Blacks services without restrictions; 31% did not admit Blacks under any conditions, even emergency.” http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1448322/
    From a book titled “Black Physicians in the Jim Crow South-1880 to 1960”: “Throughout the South white physicians often zealously solicited the patronage of blacks But white physicians were usually only interested in African-American patients who had the ability to pay, leaving charity cases to black physicians–or no one at all.

    There were of course, always some white doctors who went out of their way to offer charity care to black patients.

  5. Barry-‘

    Thanks for your comment.
    One of hte reasons to federalize Medicaid is to assure that poor people in different states all get the same level of care. This would mean providing the “essential benefits” provided under the ACA (including dental and vision for chidren, which is extremely important for poor famiies.)
    You are rigiht that long-term care absorbs a large chunk of Medicaid dollars. Going forward, I think we are likely to finance long-term care as a separate program, using a payroll tax– This was the Class program that didn’t make it into the Affordable CAre Act. AS boomers age, we are going to need long-term care. Traditionally, women who didn’t work provided long-term care for parents and other family members. That is no longer an option. (And there really is no reason why women, rather than men, should care for aging relatives.)
    We also need to reorganize long-term care. Many patients don’t need to be in “skilled nursing facilities”–they are not suffering from an acute illness, but rather from some form of dementia combined with simple aging.
    They could benefit from being in relatively small community homes where they could be cared for by good home health care workers. (The govt needs to take over that field. Today’s for-profit home heath care companies
    have been over-charging while under-paying their workers. (See MedPac’s reports) This is why the ACA is cutting payments to these companies.
    If Medicaid wasn’t trying to pay for long-term care (and often over-paying) it would have the money to provide a good package of essential benefits to Medicaid patients.
    And, if it followed Medicare in getting away from fee-for-service, those benefits would not be as expensive as they are now.
    Meanwhile we really need a separate way to fund long-term care– a payroll tax. It also would be very appropriate to use part of a increase in inheritance taxes to pay for long-term care.
    Finally, you write: “If the states were relieved of their obligation completely, state taxes probably wouldn’t decline much if at all.”
    See my 1st reply to Pat S.
    In fact, conservatives have already taken over the majority of the states, and so woudl use the money to
    cut taxes–even while refusing to fund education, repair bridges and roads etc.
    Finally, you write: “Compassion, fairness and social justice are nice concepts . . ”
    No, they’re not “nice,” they are essential to society that believes that all men are created equal. And there is enough wealth in this country to provide the education and heatlh care that everyone deserves.
    Just look at wealth in the U.S. compared to wealth in European countires. Then look at the services and safety nets that European nations provide for all of their citizens.
    Also note that you see very, very few wealthy Frenchmen, Germans or Danes immigrating to the U.S. By and large, Europeans do not want to live here.
    They see this as a culture that is obsessed with money. A culture that does not value education, does not respect the elderly, and that does not care for its children.

  6. The only way to save health care in the US is a single payer system. Unfortunately the right wingers would rather people die than admit this. Plus there are too many people with their fingers in the pie that would be shut out.

  7. John–

    There are 3 problems with single-payer:

    1) Most Americans don’t want a government-run plan to be their only choice. They don’t trust government. Wiith some reason, I would add. Consider what happened to the UK’s health care system when Margaret Thatcher was elected. She slashed the budget. UK healthcare is still recovering from what she did.
    In this country, Jed Bush plans to run next year. What if we had single-payer? You can be sure that contraception would be removed from ACA benefits.
    The right to die with dignity would be gone.
    Medicaid funding would be slashed. The subsidies would be slashed. If Bush won the White House enough Republicans woudl ride into Congress on his coattails to make that happen.
    As things stand now, even if Bush were elected, Americans would have some very good non-profit plans to choose from–Kaiser, for instance. And since the ACA
    has passed some 35 new non-profits have sprung up.
    Under the ACA non-profits will have a chance to do very well when competing with for-profits, because for-profits will no longer be able to cherry-pick or sell junk insurance.
    And even if Jed Bush were elected he wouldnt’ be able to repeal the ACA the way he would be able to trash a single-payer system. The ACA has too much support.
    2– The best health care systems in the developed world are NOT single-payer. (Single-payer advocates rarely point this out.) Only Canada and the UK have single-paye
    r. France, Germany, Denmark , SWitzerland etc. all use private insurers. Their health systems are better than Canada & the UK (when measured in terms of outcomes, and patient satisfaction.)
    But,, those private insurers are heavily regulated. Under the ACA our private insurers also will be heavily regulated. This is why many for-profit insurers will simply get out of thebusiness in 2014. Too much regulation. They won’t be able to make the money they once made by cherry-picking and selling junk insurance.
    This leaves room for more non-profits. (The best non-profits are better than Medicare in terms of what they cover, and the quality of care they provide. They don’t pay fee-for-service (which encourages over-treatment) .Doctors work together in teams– this leads to more efficient, better quality care. . . I think, not only of Here I’m thinking not only of Kaiser but of Group Health Cooperative in the state of Washington. Excellent “medical homes.” Outstanding primary care.
    3) It’s simply not feasible,. in a country as large as this one, to try to transfer everyone to a single payer system.
    As Dr. Atul Gawande has written: it would be an administrative nightmare. “People would die.”
    We have to build on what we have.
    This is how change happens.
    We also need the money that employers now put into our health care system. (Tney would never raise wages by an amount equal to what they now contribute.)
    Over time, as some for-profit insurers disappear, I suspect we will get a “public option (a govt-run insurer as an alternative to private sector insurers. (This allmost passed as part of the ACA)
    But first we need to reform Medicare. Right now , medicare overpays for many treatments, surgeries and products that provide little benefit to patients. It’s extremely wasteful. At the same time, it doesn’t pay enough for certain other services– palliative care, for instance.
    Once we reform Medicare, we can open up a government-run public option that is modeled on a reformed Medicare. And see if people want it–or if they prefer non-profits like Kaiser and Group health Coo-eraive insuring them through their employer.
    If a public option is good, it will draw customers..
    But the single-payer advocates cannot just decree that everyone must go with their system. (Originally, the single-payer advocates were well-intentioned. But over time, many have become fanatics. One doctor who used to be part of the group calls them “Stalinists”–“It’s all ‘my way or the highway'” he told me.