Medicaid Expansion Falters in Virginia

Advocates of bigger government face a tough climb.

For some, whether to expand Medicaid in Virginia boils down to a choice between two propositions: (a) Government should do more to help the unfortunate, or (b) no, it shouldn’t.

If only it were that simple. Of course it isn’t — any more than whether to invade Iraq boiled down to a choice between (a) keeping nuclear weapons out of a dictator’s hands or (b) letting him have all he wanted.

Advocates of the Iraq war pitched it like that, of course, and some greatly oversold it. They predicted a quick, low-cost victory in which American forces would be greeted as liberators and smothered in gratitude. It didn’t quite work out that way. The war ended up lasting far longer, and costing far more, than anybody anticipated. Oops.

But then, so many new government ventures do. Forecasters in 1967 predicted Medicare would cost a mere $12 billion by 1990. Actual 1990 spending on Medicare: $110 billion. (The trajectory continues: Last year Medicare consumed $536 billion.) Medicaid also has far outstripped cost projections, in certain areas by an order of magnitude.

What sort of costs and benefits might we expect from Medicaid expansion in Virginia? Two reports offer some clues.

The first comes from the liberal Commonwealth Institute, which supports expansion. The second comes from the conservative State Budget Solutions, which doesn’t.

The Commonwealth Institute says “Medicaid Expansion Would Pay for Itself” because Virginia could use federal dollars to underwrite activity it now uses state dollars to pay for, such as indigent care. What’s more, Virginia would pile up more tax revenue owing to the thousands of jobs Medicare expansion would create.

This seems overly optimistic. Take indigent care. Massachusetts was supposed to slash such spending when Romneycare expanded insurance coverage there — but it didn’t happen. A report by the National Association of Public Hospitals and Health Systems noted that hospitals lobbied for hundreds of millions in continued state payments — and got them.

That might not happen here. Yet even if it doesn’t, ask yourself what state lawmakers would do when shifting indigent care to Medicaid frees up $70 million a year. Would they cut taxes by an equivalent sum — or spend the money elsewhere? The answer is obvious. But if the money simply gets spent elsewhere, then saying the state has “saved” that money seems inaccurate.

The Commonwealth Institute also argues that because expanded Medicaid would shoulder more of the cost for community mental health services, “it would reduce state spending for these services” and “save the state $292 million over the next nine years.” Sounds good. But in the next breath the report says many mental health agencies “have waiting lists,” so “Medicaid expansion could free up capacity and funding” for them. In other words, those savings might get plowed right back into the local agencies. This might be a wonderful thing for Virginia’s neglected system of mental health treatment. But should it qualify as a savings?

Like other advocates, the Commonwealth Institute cheers the “tens of thousands of well-paying health care sector jobs” that Medicaid expansion would create. Should it? Allocating the jobs elsewhere might be more economically beneficial. Consider this from a recent post on the website of the Harvard Business Review:

“Over half of the $2.6 trillion spent on health care in the United States in 2010 was wages for health care workers, and labor productivity has historically worsened at a rate of 0.6 percent per year. ... Demand and supply are not growing in tandem: From 2002 to 2012, inpatient days per capita decreased by 12 percent while the workforce in hospitals grew by 11 percent. ... Unfortunately, health care as an industry continues hiring far faster than demand is growing.”

Shouldn’t health care reform make productivity better, not worse?

The report from State Budget Solutions offers another reason for concern: Medicaid expansion might “shift people away from private insurance and into public insurance.” It draws attention to Arizona, which expanded Medicaid over a decade ago and also “expected to reduce state spending by lowering the costs for uncompensated care.” But “the estimates were all wrong. ... Rather than saving millions per year, costs jumped. ... Private insurance enrollment dipped. ... Eight years after expansion, Arizona had spent four times as much as expected.”

To which you could fairly reply, so what? Medicaid expansion still might be worth any price if its new beneficiaries will be better off. But will they?

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  • sarcasmic||

    Intentions trump results.

  • Calvin Coolidge||

    But, we didn't mean for them to!!!

  • Its Amazing||

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  • Floridian||

    "inpatient days per capita decreased by 12 percent while the workforce in hospitals grew by 11 percent"

    Reduced inpatient days are a goal of the hospitals. Hospitals lose money on inpatients. They make most of their money in the operating rooms. So the goal is more surgery with decreased post-op days in house. That would count as an increase in profitability if not an increase in productivity.

  • Pro Libertate||

    Some day, it'll all be robotic and remote. You'll just have a van drive up to your house, perform surgery, and drive off. Maybe leaving a robot nurse until you're recovered enough.

  • ||

    Unless sufficiently developed neural nets are developed first, in which case we'll live for eternity, or at least the portion of it until our sun dies, as disembodied cyber consciousness with no need of medical care.

  • Pro Libertate||

    Huh. So you're saying I can stop looking for monoliths?

  • ||

    Depends how long it takes to get our neural nets...

  • Almanian!||

    If the robot nurse can administer a happy ending, this might be a lovely future.

  • Pro Libertate||

    Of course, we all know that full immersion VR porn with haptic interfaces is what ends the human race. With or without robots.

  • Floridian||

    They have robot that delivers medication in the hospital. It's name badge says its name is Tugg. I got on the elevator with it one time and it freaked out. I didn't know you weren't suppose to ride with it. I guess I screwed up its proximity sensors.

  • Pro Libertate||

    I think it's interesting how much technology forces us to adapt to it, rather than the other way around. Sit wrong on an automatic toilet and get perpetual flushing. Stand in an elevator with a medical robot and risk total annihilation. And so on.

  • Floridian||

    Yeah. This thing was basically a large metal rolling cabinet so when it started spinning back and forth I had to pin myself against the wall to keep from getting crushed.

  • Pro Libertate||

    It's okay. The First Law will protect you.

  • UnCivilServant||

    Due to an oversight, the three laws were never implemented.

  • Pro Libertate||

    Wait, what? But, but they're walking among us and stuff. Assaulting us in elevators.

  • UnCivilServant||

    Yeah, sorry about that.

    But hey, we got the robotic lawnmowers to market on time :)

  • Pro Libertate||

    Robot lawnmowers with spinning blades of death unlimited by the Three Laws.

  • Floridian||

    Skroeder: Maybe it's pissed off.
    Newton Crosby: It's a machine, Schroeder. It doesn't get pissed off, it doesn't get happy, it doesn't get sad, it doesn't laugh at your jokes...
    Newton Crosby, Ben Jabituya: ...IT JUST RUNS PROGRAMS!

  • Rasilio||

    The nurse probably won't be programmed to, but I guarantee you that once robots that advanced exist sexbots will be one of their first applications

  • Pro Libertate||

    I don't know whether this is actually true, but I once read that porn was one of the earliest things printed after the Gutenberg Bibles. And we all know what the Internet is primarily based on.

  • UnCivilServant||

    All I know is that there was an explosion in literacy among the lower classes around that time. Something had to be appealing to them to read...

  • Pro Libertate||

    Of course. All major advances in human technology and art were driven by sex, porn, or both.

  • Francisco d Anconia||

    They have a plan.

  • ||

    That's great if you want your dick ripped off or squeezed like an orange.

  • Tony||

    The U.Va. study is being cited by a few conservatives. Unfortunately, they are missing the point or lying.

    The study does not claim that Medicaid is the cause of the worse health outcomes (therefore it does not describe a causal relationship, and neither does Hinkle, i.e., how exactly does Medicaid do this?). The reason these patients have worse outcomes is because people on Medicaid are the poorest, sickest, and least educated of all the groups. "Medicaid patients had the highest incidence of acquired immunodeficiency syndrome, depression, liver disease, neurologic disorders and psychoses . . . and the highest incidence of metastatic cancer," the study says.

    This group would have the worst healthcare outcomes with or without Medicaid. The uninsured group includes people with high incomes who are uninsured by choice.

    So as with almost everything else, the underlying problem is poverty, not some government program.

  • SugarFree||

    Please stop feeding the troll.

  • Tony||

    Sorry, but I couldn't let the troll's mischaracterization of a study go unchallenged.

  • sarcasmic||

    troll's mischaracterization of a study


    That would be you, all day long.

  • Neoliberal Kochtopus||

    Thank you.

  • ||

    At this point, to borrow a line from one of yesterday's article's, Tony's trolling has become a self-licking ice cream cone. If nobody responds he just replies to himself and/or ramps up the level of idiocy until somebody at least has the decency to call him a moron. Any attention is good attention.

  • sarcasmic||

    Unfortunately, they are missing the point or lying.

    That would be you, all day long.

  • ||

    “Medicaid payer status was associated with the longest length of stay and highest total costs” — and that’s after “controlling for age, gender, income, geographic region,” and so on.

    Who are you going to believe, Tony or your lying eyes?

  • sarcasmic||

    Is Tony missing the point or lying? I'll go with lying.

  • ||

    Is Tony missing the point or lying?

    Yes.

  • Floridian||

    people who are uninsured have an incentive to leave the hospital since they are paying for each day they are there, where if Medicaid is paying the bill why not stay and enjoy free food, drugs, wait staff and cable TV

  • Tony||

    The authors of this study explicitly say they do not blame Medicaid for the poor outcomes. You can look it up. I know you won't.

  • ||

    No, they just said that Medicaid payer status was associated with the longest length of stay and highest total costs and, contra your assertion that the difference is entirely explained by income, that was after controlling for age, gender, income, and geographic region. Do you know what a lurking variable is?

  • DH||

    It looks like they also controlled for morbidity(multi-disease). But apparently all government needs to do per Tony is fart some magic dust onto the poor of society and then we won't have poor sick dumb bastards anymore.
    All hail the power of gubment.


    http://www.nationalreview.com/.....-without-#!

  • Tony||

    Yes, and I quoted the passage in which the authors list some of the factors not accounted for. Others include the differing ways Medicaid payers use the system, the fact that private insurance holders have access to better doctors and facilities.

    The point is the study does show a correlation with Medicare payer status and worse health outcomes. It suggests several reasons this association exists, but none of them are causal.

    This is not to say the entire thing is solved, but current income level doesn't account for these variables, and the most important point is that Hinkle is wrong in suggesting that merely being on Medicaid increases your healthcare outcomes. It is very likely the case that taking Medicaid away will only make the outcomes worse.

  • sarcasmic||

    He's got the straw man on the ropes! Looks like a KO!

  • KPres||

    "the fact that private insurance holders have access to better doctors and facilities."

    In other words, single-payer systems have worse doctors and facilities than private insurance systems, and this causes worse outcomes.

    I agree.

  • MJBinAL||

    Your are right Tony, this study did NOT establish a causal relationship between Medicaid and poor outcomes. In fact, the study did not establish any causal relationships at all.

    I did not see any comments here claiming they did. HOWEVER, a number of comments theorize on possible mechanisms to explain (and therefore establish a causal relationship) the apparent relationships.

    "I hit Tony in the head with a sledgehammer yesterday." and "Tony died yesterday." does not assert "I killed Tony with a sledgehammer yesterday.". It is however, the odds on bet.

  • KPres||

    I wouldn't associate a sledgehammer to the head with Tony's death. You're not accounting for the thickness of his skull or the lack of a brain inside.

  • KPres||

    They may not blame Medicaid (for PC and funding reasons no doubt), but their data and findings sure do.

  • wareagle||

    govt tried to solve property. It made the problem worse.

  • MJBinAL||

    Tony, Just for a change of pace, READ the article first, THEN twist it to your bias.

    Near the end of the article (I know, so HARD to read the whole thing!) it points out that the study was “controlling for age, gender, income, geographic region,” .

    Controlling for income. got That?

  • KPres||

    ""The reason these patients have worse outcomes is because people on Medicaid are the poorest, sickest, and least educated of all the groups.... The uninsured group includes people with high incomes who are uninsured by choice. ""

    Of the three factors you listed, only "sickest" would reasonably have an effect on health outcomes. Any effects from the other two would already be represented by "sickest".

    Having cleared that up, even if I accept that Medicaid patients are sicker than the general population of uninsured, it's irrelevant, since the study only looked at those from each group that were "sick" (ie, had surgery). Healthy people are excluded.

  • Francisco d Anconia||

    I went to the dentist yesterday. Almost got up and walked out.

    Anyone who says government regulation and fear of litigation don't drive up the price of healthcare are completely ignorant. Since being required to pay my dental out of pocket, I've become quite the interested consumer. I asked the price up front and told them I don't need no stinkin x-rays.

    Long and short of it. He refused give me a checkup and cleaning unless I submitted to paying him an extra $120 for the x-rays, claiming he could lose his license and or be sued if something went unnoticed.

    I was incensed, yet submitted because I figured I'd just go through the same bullshit elsewhere and I needed to get it done. The x-rays...found nothing.

    Fuck government regulations. Fuck illegitimate lawsuits and the shitstain lawyers who get rich because of them.

  • Floridian||

    Liability is huge in healthcare. If two months later you found out you had a tumor in your mandible and found it has now spread to your brain you would have a case if the dentist did not follow standards of care. Now if you had liability waivers that were iron clad people could make more decisions about what level of care they want and weigh cost vs risk.

  • Francisco d Anconia||

    This is the point. I was made aware of the odds/possibilities and declined the procedure. The only place I should be able to win such a lawsuit should be fantasyland.

    Fuck the irresponsible and fuck those who want something for nothing.

  • Floridian||

    I agree. I don't have a source but I have heard that 20% of healthcare cost are driven by liability mentality. An example is ordering lab work for healthy 20 year olds. The odds of someone with no health complaints having an illness that can only be identified with lab works is extremely rare, but doctors order it just in case

  • ||

    Nuh huh. They order them cause doctors are greedy bastards that hate poor people. That's why we need to have single payer!

    /Tony

  • frankania||

    Here in Mexico dental care is so cheap, that you could fly here for a vacation, get the dental work done, and come out ahead.
    Had a friend come here who had just paid $190 for tests and xrays and still had a bad tooth. Dentist here pulled it for 6 bucks.

  • steffenmulroy||

    my friend's mother-in-law makes $88/hr on the laptop. She has been fired from work for ten months but last month her payment was $15328 just working on the laptop for a few hours. official website
    =========================

    http://www.works23.com

    =========================

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