Medicaid’s Major Malfunctions

In The Wall Street Journal, Scott Gottlieb of the American Enterprise Institute rounds up a batch of studies showing that health outcomes for patients covered by Medicaid, the joint federal-state health program for low-income and disabled individuals, are actually worse than those covered by no insurance at all.

• Head and neck cancer: A 2010 study of 1,231 patients with cancer of the throat, published in the medical journal Cancer, found that Medicaid patients and people lacking any health insurance were both 50% more likely to die when compared with privately insured patients—even after adjusting for factors that influence cancer outcomes. Medicaid patients were 80% more likely than those with private insurance to have tumors that spread to at least one lymph node. Recent studies show similar outcomes for breast and colon cancer.

• Major surgical procedures: A 2010 study of 893,658 major surgical operations performed between 2003 to 2007, published in the Annals of Surgery, found that being on Medicaid was associated with the longest length of stay, the most total hospital costs, and the highest risk of death. Medicaid patients were almost twice as likely to die in the hospital than those with private insurance. By comparison, uninsured patients were about 25% less likely than those with Medicaid to have an "in-hospital death." Another recent study found similar outcomes for Medicaid patients undergoing trauma surgery.

• Poor outcomes after heart procedures: A 2011 study of 13,573 patients, published in the American Journal of Cardiology, found that people with Medicaid who underwent coronary angioplasty (a procedure to open clogged heart arteries) were 59% more likely to have "major adverse cardiac events," such as strokes and heart attacks, compared with privately insured patients. Medicaid patients were also more than twice as likely to have a major, subsequent heart attack after angioplasty as were patients who didn't have any health insurance at all.

• Lung transplants: A 2011 study of 11,385 patients undergoing lung transplants for pulmonary diseases, published in the Journal of Heart and Lung Transplantation, found that Medicaid patients were 8.1% less likely to survive 10 years after the surgery than their privately insured and uninsured counterparts. Medicaid insurance status was a significant, independent predictor of death after three years—even after controlling for other clinical factors that could increase someone's risk of poor outcomes.

This should sound familiar to Reason readers: I’ve made similar observations about Medicaid’s health outcomes before, and I think it’s important to look at these studies in the context of Medicaid’s fiscal effects on state and federal government, as well as the recent health care overhaul’s planned expansion of the program: Already the program is wrecking state budgets, but state officials don’t have much flexibility to adjust the program to fit the needs of their states. Instead, thanks to the program’s insistence on matching federal dollars to state spending, they do have an incentive to continually increase the size of the program during times of economic growth. According to a Congressional Budget Office report released this week, block granting the program—as many cash-strapped governors have requested, but as the Obama administration has so far refused to consider—would reduce Medicaid’s cost by an estimated $287 billion over the next decade.

Meanwhile, thanks to the expansion of eligibility called for in the health care law, approximately 16 million additional individuals—and perhaps millions more than that—are expected to end up on Medicaid’s rolls over the next decade. That represents a huge portion of the law’s near-trillion dollar first-decade expense. But if Medicaid’s health benefits are as dubious as these studies seem to suggest, then we’ll be spending a lot of money for a very little in terms of health benefits.

Comparative judgments based on studies like these can be difficult to make with absolute certainty; the research isn't perfect. In particular these studies have a hard time controlling for the negative health effects associated with poverty. And studies do tend to show somewhat greater health effects at the lower end of the income spectrum (which suggests that we should be trimming eligibility rather than expanding it up the income scale). But as Avik Roy has documented in extensive detail, the evidence that, overall, Medicaid coverage correlates with poor health outcomes is fairly strong across numerous studies. How long must we continue to invest hundreds of billions of dollars into a program of such dubious value?

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  • ||

    There are some definite confounding factors in this:
    1)Medicaid members are likely poorer on average than uninsured. There's a good correlation between poverty and health status
    2)Some people get on Medicaid after a "spend down" using medical expenses a the "vehicle" to spend down. So they get into Medicaid as a means of getting health coverage.
    3)I'd have to look at the actual articles to see if they factor out the Seniors who get on Medicaid. Some of those at "baseline" are poor but some spend down to get into long term custodial care

  • Name Nomad||

    Uninsured people might(?) also be younger on average and, therefore, healthier.

  • ||

    This is anecdotal, but our experience (and we have a very large Medicaid and uninsured population) is that Medicaid patients are the absolute worst in terms of blowing off appointments, being noncompliant, abusing staff, demanding drugs and treatment they don't need, etc.

    Its almost like they have an entitlement mentality, and an entitlement mentality is not conducive to being a good patient.

  • DNS||

    Its almost like they have an entitlement mentality, and an entitlement mentality is not conducive to being a good patient.

    Almost?

  • Brett L||

    My current GF does pediatric case management for Medicaid. She may be the most jaded person w/r/t Medicaid I've ever spoken with. Just breathtakingly horrid stories about both the patients and the bureaucracy. I think the docs who deal with that are crazy to get involved.

  • ||

    I would certainly agree with that point. When I staying in a veterans hospital for Hodgkins disease treatment, where you see another entitled population, it was amazing the self destructive behavior you would see - hurt yourself and get free care. Apparently, poorer people believe that Dr. Kildare and Marcus Welby (Replaced by Doc "House") can cure everybody of everything, so why stop drinking if you have cirrhosis?

    One other point - a week or so ago I left a link from a "Lefty" economist saying that you couldn't prove that medicaid gave worse outcomes. And I agree with that - but it also means you can't prove much value to having health insurance to begin with. Health care, and heath insurance are two different things.

  • ||

    referenced link. The point I would make is that it is very, very difficult to prove medicaid is worse than nothing, OR that health insurance in better than nothing also

    http://theincidentaleconomist......mes-again/

  • widget||

    ...abusing staff,...

    The sad thing is that probably works better in a bureaucracy than being polite.

  • Montani Semper Liberi||

    This level of care coming soon to all Americans. Thanks, Pelosi and everyone else who voted for ObamaCare.

  • Warty||

    Medicare, you provide medical care like old people fuck!

  • ||

    The article was about Medicaid

  • Alan Vanneman||

    I agree with Chris. Peter tells us "In The Wall Street Journal, Scott Gottlieb of the American Enterprise Institute rounds up a batch of studies showing that health outcomes for patients covered by Medicaid, the joint federal-state health program for low-income and disabled individuals, are actually worse than those covered by no insurance at all."

    But most of the comparisons are to people with insurance, not those without it. What is the purpose of including that data? People without health insurance? Who are they? People who are young and healthy. It's easy to believe that there is a lot that's wrong with Medicaid, but this sort of glib "analysis" only makes us more skeptical of the critics.

  • Brett L||

    You should re-read. The value is that (a)Medicaid does not provide outcomes similar to private insurance, and (b)persons who choose not to be insured are statistically healthier after major procedures than persons with Medicaid. If you're interesting in helping the poor get medical care, why not just give them a voucher for private health-care?

  • ||

    "If you're interesting in helping the poor get medical care, why not just give them a voucher for private health-care?"
    While Medicaid is not a "voucher" in the strictest sense it is a "ticket" to get health care (at a doc's office or hospital) that accepts Medicaid. By and large hospitals accept Medicaid. There's much wider variation in physician practice that accept Medicaid. That may point to an additional confounder in this data, the similarity and possible the quality of the physicians who serve each community.

  • Brett L||

    No. The point is that the person receiving care has little or no relation to the person paying for care. Additionally, they pay the same (nothing) for their Medicaid no matter what their lifestyle while my private insurance is substantially more expensive if I am a smoker/diabetic/obese, etc. Giving someone $XXXX to be spent on insurance of their choosing might compel different behaviors. As the article points out, it is unlikely to produce worse results than the current system.

  • widget||

    "People without health insurance? Who are they?"

    They would be people who don't purchase health insurance.

  • Zimbabwe Bob||

    There is really no reason you'd want to control for differences in the populations in a study like this.

  • ||

    How does the method of payment (public/private) have an outcome on the outcome of the procedures that are ALL provided by private practitioners? There are no government healthcare providers, just moneymen. So the idea that the medicare is killing people and not poverty or ignorance of belonging to the lower class seems like either a disingenuous analysis written to reinforce the idea that govt=death or wishful thinking that the form of payment has magical moral implications.

  • ||

    Well there ARE government healthcare providers, often city or county run (not to mention those run by university medical centers) I would wager that these governmentally-run providers see a higher proportion of Medicaid patients than other private providers.

    Having said that, the lousy health status and health outcomes of the poor is well researched. What is disturbing in the conversation is the desire to make this an "excuse" or a reason for "blame" (i.e. "they're victims of their circumstances" vs "they brought it on themselves")

  • widget||

    "How does the method of payment (public/private) have an outcome on the outcome of the procedures that are ALL provided by private practitioners?"

    We are all private practitioners of services we keep or trade. Look in the mirror.

  • ||

    I'd also note that the studies highlighted are on adult patient outcomes. Medicaid is about 50% children and is also disproportionally female. I'd be interested in comparing pediatric outcomes (i.e. pediatric well child care, pediatric asthma care) between Medicaid vs Uninsured vs Private Insurance. I would not be surprised if such data painted a different picture

  • GSL||

    I find it suspect to try to link any form of insurance to health outcomes. Insurance coverage doesn't cause good health, no matter how many times Tony tries to convince us. And certainly there are apples-and-oranges issues here. For example, a decent amount of Medicaid spending occurs among the terminally ill who've spent down their resources to the point of being eligible. Tough to really make sense of any health-outcomes comparison between these folks and any other insured or uninsured people.

  • cynical||

    I doubt it's the program so much as those who are in it, absent some evidence as to what differences there are in treatment for Medicaid and the uninsured.

    As much as liberals refuse to accept it, a lot of people are poor for a reason, and that reason is not "society" or "exploitation", it's "they're assholes/fuckups". People who fuck up their wealth are also prone to fuck up their health.

  • ||

    How does the method of payment (public/private) have an outcome on the outcome of the procedures that are ALL provided by private practitioners

    Aside from the way Medicaid patients like to sabotage their own care, there are a lot of doctors who don't take Medicaid. So you're tracking populations that are getting care from different sets of providers, which can mean differences in outcomes.

  • ||

    Tough to really make sense of any health-outcomes comparison between these folks and any other insured or uninsured people.

    Its pretty routine to risk-adjust health outcomes research (that is, take into account severity of the patient's condition). Don't know if it was done in this survey, but it can be done.

  • ||

    An unlikely source brings light to this subject.

    Health care services use by itself had little explanatory effect on the income-mortality association

    Unfortunately this author, as expected has two further (predictable) points:
    1) it could have been worse
    2) we should spend more money on "early-childhood education and efforts to strip lead out of walls" etc

  • Austin Frakt||

    Association is not causation.

    Gottlieb's cited studies don't support his claim: http://theincidentaleconomist......s-studies/ .

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