California Study Debunks Claims That Medicaid Expansion Will Increase ER Utilization Long Term And Excessively Increase Costs

Opponents of the Affordable Care Act and Medicaid expansion have often twisted the results of a study in Oregon showing an increase in Emergency Room utilization after their expansion of Medicaid. Subsequent studies have debunked claims that Medicaid patients are abusing Emergency Rooms and studies of the Medicaid expansion in Ohio showed that better management of the Medicaid patients can lead to better control of chronic disease while limiting Emergency Room use. A new analysis from the UCLA Center for Health Policy Research released Wednesday also specifically debunks claims made based upon the Oregon study, showing that the increase in Medicaid utilization is short-lived. From Kaiser Health News:

While the Medicaid expansion may lead to a dramatic rise in emergency room use and hospitalizations for previously uninsured people, that increase is largely temporary and should not lead to a dramatic impact on state budgets, according to an analysis from the UCLA Center for Health Policy Research released Wednesday.

Researchers reviewed two years of claims data from nearly 200,000 Californians, including a group  who had enrolled in public programs well in advance of the expansion of Medi-Cal,the state’s version of Medicaid, in January. These programs were designed to ease the expansion of Medicaid by providing insurance to low-income adults who were not eligible for Medi-Cal at that point but would be when the health law’s expansion went into effect earlier this year. The researchers  divided the group into four categories, based on the researchers’ assessment of each group’s pent-up demand for health care.

In July 2011, after being enrolled in California’s Low Income Health Program, the so-called “bridge to reform,” the group with the highest pent-up demand had a rate of costly emergency room visits triple — or more — that of the other groups. But from 2011 to 2013, that high rate dropped by more than two-thirds and has remained “relatively constant,” according to the analysis.

“We were hoping that this would be the case,” said lead author Jerry Kominski, director of the UCLA Center for Health Policy Research, “because we think that that’s what access to care does for low-income individuals … that there’s an additional increase in demand for services and that that demand, or utilization, drops off pretty rapidly.”

Rates of hospitalization for the “highest pent-up demand” group also started high and dropped by almost 80 percent over the two-year period. Curiously, if ER and hospitalization rates were dropping, it’s reasonable that outpatient visits might rise. But that wasn’t the case; the rate of outpatient visits was largely unchanged during the two-year period.

Kominski said that one of the fears of the Medicaid expansion was the potential high cost of low-income patients. He argued that this analysis should ease those fears: “What our findings say to the country is (that) concerns about Medicaid expansion being financially unsustainable into the future are unfounded.” Under the Affordable Care Act, the federal government provides 100 percent of the cost of the newly eligible under the Medicaid expansion, but in 2017 that contribution will phase down until it reaches 90 percent in 2020.

As was the case in Ohio, a key factor in keeping costs down was better coordination of patient care:

One factor in helping drive down the higher rates of use, Kominski said, is better efforts at coordination for Medi-Cal beneficiaries. For example, virtually all Medi-Cal beneficiaries are now enrolled into a Medi-Cal managed care plan. “To the extent that other states don’t have adequate coordinated care mechanisms in place for their Medicaid populations, then the kinds of drop off that we observed in California may not occur there,” Kominski said.

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Health Care Advocates File Suit Against California For Lag In Enrollments In Expanded Medicaid Program

By most measures the Affordable Care Act has been a success, increasing the number insured without the problems predicted by Republicans. However not everything has worked out perfectly to date. The biggest problems have been with the expansion of Medicaid. The worst problem has been seen in the Republican controlled states which have blocked Medicaid expansion, but there are also problems in some states which are attempting to participate in the program. Last May, Joe Gandelman reported at The Moderate Voice on a case in which someone he knew who was in need of immediate medical attention had difficulty obtaining coverage. It turned out that the problem was that he qualified for the expanded Medicaid program in California. As he qualified for this, he could not receive subsidies in the exchanges, but he did not receive timely coverage due to a backlog of around 600,000 people who qualified but were not processed for the program.

Since then I have looked at this backlog periodically as data came out and while the number has decreased, hundreds of thousands of people have still not received coverage. A coalition of health care advocates has now filed a suit against the state in response to this backlog. Kaiser Health News reports:

California’s lingering backlog of Medi-Cal applications has left hundreds of thousands of people unable to access the health care they are entitled to receive, according to a lawsuit filed Wednesday by a coalition of health advocates and legal services groups.

The lawsuit, filed in Alameda County Superior Court, says the state is failing to process applications within 45 days as required by law. Some applicants have been waiting to receive their Medi-Cal cards since the end of last year, according to the suit. The applicants include children, pregnant women and adults with life-threatening health conditions, who advocates say are either postponing treatment or paying cash to see doctors.

Medi-Cal is the state’s version of Medicaid, the publicly funded health insurance program for low-income Americans. About 11 million people receive Medi-Cal benefits in California, including 2.2 million who applied since January. Roughly 350,000 applications are still pending.

The lawsuit cites several cases, including that of Tulare County resident Robert Rivera, who applied for Medi-Cal in January but died of a pulmonary embolism while the state was determining if he was eligible for the insurance. Two months after his death, Rivera’s mother received a letter saying that the benefits had been approved.

Los Angeles County resident Mark Mullin submitted an application in February 2014, but wasn’t approved until four months later — after he sought legal help. During the time his application was stuck in the backlog, Mullin had to undergo an emergency appendectomy.

The suit is asking the state to process cases within 45 days and to grant people Medi-Cal benefits while officials verify applicants’ incomes. The coalition is also asking the state to send notices to Medi-Cal applicants who have been waiting for 45 days notifying them of their right to go before an administrative law judge.

The long wait is “unacceptable,” said Katie Murphy, managing attorney at Neighborhood Legal Services of Los Angeles County. Murphy said she is concerned that the problems will get worse as more people apply for Medi-Cal. “If they are not fixed, more people will continue to wait and more will continue to suffer medical emergencies,” she said.

California Department of Health Care Services officials said they have been working closely with the counties and have reduced the backlog by 250,000 since early July. Many of the cases are still pending because of incorrect or incomplete information.

Department spokesman Tony Cava said people who need immediate care can get in-person assistance with their application at a county social services agency. They also can get their medical bills covered for care received while their applications were pending, he said.

The lawsuit was filed by several organizations throughout California, including Neighborhood Legal Services of Los Angeles County, the National Health Law Program and Bay Area Legal Aid.

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Hundreds of Thousands More People To Obtain Health Care Coverage Under Obamacare With Pennsylvania Joining Expanded Medicaid Program

Pennsylvania has become the 27th state, and 9th with a Republican governor, to accept the expanded Medicaid program. This significantly increases the number of people to receive health care coverage under the Affordable Care Act starting with about 300,000 and increasing to over a half million over the next two years. Some Republican governors are vulnerable for failing to join the program, especially considering that the federal government will pay 100% of the expense for expanding health care coverage through 2016, and afterwards it will gradually fall to 90 percent. Corbett is in danger of losing his reelection bid in Pennsylvania but it does not appear that his late adoption of the program will be enough to save him.

Currently three additional states, Indiana, Missouri, and Utah, are considering expansion and twenty states are not  considering Medicaid expansion at this time.

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Biggest Lies About Obamacare Debunked Once Again

Michael Tomasky described how, despite all the predictions and lies from opponents, the Affordable Care Act is working and the dire predictions are all failing to come true. He suggested why all the predictions of doom have failed to come true:

…maybe it’s not just dumb luck that the law seems to be working, especially in the states that took the Medicaid money and set up well-run exchanges. Maybe it’s working because bureaucrats (!) anticipated all the potential problems and planned for them in the writing of the law. Nancy-Ann DeParle, one of the administration’s chief architects of Obamacare, put it this way: “When President Obama took office, there were 42 million uninsured Americans, premiums that were unaffordable for families and businesses, a delivery system with the wrong incentives, and unsustainable cost growth. The Affordable Care Act was the product of nearly two decades of bipartisan analysis and discussions among health policy experts and economists to address these problems, and most–indeed, virtually all–of the policies in the law had widespread agreement from these experts.” In other words, writing this law wasn’t guesswork.

He then listed what he considered to be the five biggest lies about Obamacare and why they are not true:

1. Healthy People Won’t Sign Up

Or call this “Death Spiral Part I.” The idea here, spread lustily by many conservatives since 2010 but especially during last fall’s disastrous roll out, was that healthy people simply wouldn’t buy insurance. Senator Orrin Hatch said last November that “at this pace, the Obama administration will never be able to meet their enrollment goals.” Speaker John Boehner at the time groused that “the idea that the federal government should come in and create a one size fits all for the entire country never was going to work.”

Their hope was that only really sick people would sign up, which would lead rates to spike—the much-feared death spiral (more on that later). But lo and behold it turned out that millions of healthy people did want health insurance. As noted above, the precise numbers are hard to come by. But Gallup’s estimate is that the country has roughly 10 million newly insured citizens under Obamacare. And insurance companies report that around 80 to 85 percent of them are paying their premiums (this was another canard spread on the right, that people would sign up but never pay).

In sum, the law’s advocates were right, and its critics wrong, that health insurance was something normal Americans did in fact want. “There never was any realistic prospect of a death spiral,” says Jon Gruber of MIT, one of the country’s top health-care economists.

2. You Won’t Be Able to Choose/Keep Your Doctor/Plan

It’s true that this happened in a limited number of cases—maybe six or seven million people who bought policies on the individual market got cancellation letters from insurers telling them that their plans didn’t meet the minimum requirements under the new law, as NBC News explosively reported last fall.

It harmed the administration’s credibility, and rightly so. But it didn’t represent much of a change from the past — the “churn-rate” in the individual market has always been high. More importantly, no one seems to have followed up with this population to try to figure out what percentage did, in fact, lose coverage and/or have to pay considerably more for a new plan, so we don’t actually know how many of those six or seven million walked away satisfied or dissatisfied.

But more broadly, in a country where some 260 million people have health insurance, no one has adduced any proof that the ACA has resulted in anything remotely like the cataclysm opponents predicted. In fact, last fall, Factcheck.org rated such claims as outright falsehoods. And Gruber noted to me that if some people are “losing” their doctors, it’s often by their own choice, because now that they have so many different coverage options, many are choosing less expensive or so-called “limited network” plans. “No one is making people buy these plans,” Gruber says. “They’re cheaper alternatives. This is capitalism at its finest. For the right to criticize that is just ludicrous.”

3. Obamacare Will Explode the Federal Deficit

You heard this one a jillion times back when the law was being debated. Still today, Republicans and conservatives are deft at cherry-picking numbers out of official reports that can convey the misleading impression that fiscal watchdogs think the law will be a disaster.

The truth is that the Congressional Budget Office said in 2010 and reaffirmed this summer that the Affordable Care Act’s budget impact would be positive. The 2010 estimate was that the ACA would cut deficits by $124 billion over its first decade. And in June, CBO head Douglas Elmendorf reported that his experts “have no reason to think that their initial assessment that the ACA would reduce budget deficits was incorrect.”

Now, he throws in a number of caveats, as any bureaucrat should, having to do with the fact that many provisions of the act will kick in later. But Elmendorf sees no hard evidence to suggest that initial estimates were wrong. In fact, says Paul Van de Water of the Center on Budget and Policy Priorities, “The CBO has estimated that the law will especially reduce the deficit in its second decade, and there’s every reason to believe that those estimates are on course.”

4. Okay, Then, It Will Bust States’ Budgets

Texas’ Rick Perry, Florida’s Rick Scott, and numerous other Republican governors have said that Obamacare will bust their budgets. They’re basing that on the fact that the federal government will pay 100 percent of the costs of Medicaid expansion through 2016, but a little less than that thereafter (although never less than 90 percent). So states are going to have to start shelling out (that is, states that take the money in the first place, which Texas and Florida did not).

That’s true as far as it goes. But here’s the part Perry and Scott leave out. All states have, of course, an existing relationship with the Medicaid program in which states pay for some portion of the program’s implementation. And a number of studies estimate that in that pool of funds, states will save significant amounts of money that will offset most of the new expenses incurred under Obamacare. For example, Massachusetts found that after implementation of Romneycare, its costs for “uncompensated care”—charity work, basically—decreased considerably. And one study released in June found that uncompensated care costs are already dropping dramatically under the ACA—but only in the states that have taken the Medicaid money.

Thus, Perry, Scott, et alia are perhaps agents of a self-fulfilling prophecy: Yes, the ACA might bust the budgets of their states—the states trying to kill off Obamacare. But in the states trying to make it work, the budgetary impact, say most nonpartisan experts, will be a little bit negative, but pretty small.

5. Premium Rates Will Shoot Through the Roof

This is the big enchilada, and the culmination of the alleged death spiral. The charge here is that the lack of healthy enrollees will force insurers to jack rates up to the heavens, because they’ll have all these sick and dying people on their hands. Premium hikes for this year were all over the map, because they were based on guesswork by the insurance companies about who was enrolled. But now, the companies have hard data. So just watch, critics say, as the rates go boom.

To be sure, you can go to your Google machine and enter “insurance premium increases 2015” and find a lot of scary headlines from earlier this year. But you can ignore them all, because no one really knows yet.

Here’s how it works. By roughly this past Memorial Day, insurance companies submitted their 2015 rate requests to the states. These could range from tiny to huge—but they’re just requests. State insurance commissioners are now reviewing the requests. Final, approved rates will be made public in November (before November 15, when Obamacare’s second enrollment period begins). By the way, the ACA, for the first time ever, rationalized this “rate season,” so that everything happens in almost every state at the same time and in more or less the same way. Before, there was no national logic to the process at all.

Again, to echo back to what DeParle said: The people writing the law knew all this was coming, and understood very well that rate shock would be a risk. As a result there are numerous provisions in the law designed to guard against it. The most notable one carries an obvious name: “rate review.” Under rate review, any request for an increase of 10 percent or more has to be approved by a board, to which the insurer has to offer copious documentation proving that such a hike is necessary. Prior to the ACA, there was no such review.

Before we go any further, let’s step back. What’s a typical, pre-ACA rate increase? Good question. In 2008 it was 9.9 percent; 2009, 10.8 percent; 2010, 11.7 percent. Within those broad averages, numbers were all over the map: In 2010, rates went up in Kentucky by just 5.5 percent, but in Nebraska by 21.8 percent.

The numbers released in November will similarly be all over the map. There are just too many variables to say otherwise—how much competition there is among insurers in any given state (in general, it’s increased); what the risk pool looks like in a state (how old, how sick); and other factors. So undoubtedly, there will be some isolated hair-raising increases.

We don’t know, but we do have some early indications and studies, and they are pretty hopeful. The Health Research Institute at PricewaterhouseCoopers looked at rate requests from insurers that have been filed across 29 states and the District of Columbia and found that the average increase is 8.2 percent, which is impressively low and definitely not “sticker shock.” And remember, these are mostly just requests (in Rhode Island and Oregon, the rates are final), which aggressive state insurance commissioners might seek to make still lower.  “So far, the filings suggest modest increases for 2015, well below the double digit hikes many feared,” says Ceci Connolly, the managing director of the institute.

All the above is about the individual market—people buying insurance on their own, either through state exchanges or the federal marketplace. For a host of reasons, that’s the best barometer by which to measure the law’s success. But there are other markets, too, notably the small-business market, where employers with fewer than 50 employees buy for their workers. There has been some grumbling among conservatives that this “small-group” market will take an especially hard hit, but that seems not to be the case either.

Again, there will be great variance in the small-group market, according to Jon Kingsdale, of the Wakely Consulting Group in Boston. He says the biggest impact will be that, because of some technical changes made by the law, employers with older employees and larger families will likely see rates increase, while employers with younger workers and smaller families may see rates decrease.  But overall, says Kingsdale, “I do not believe there will be a significant jump in rate in the small-group market, because the underlying body of people being insured is not so different from the prior year.”

One last point on rates: This is another area where Republican saboteurs of the law can, if they choose to, make it not work. That is, Republican state insurance commissioners can approve big premium hikes just to make the law look bad. Says Sally McCarty, the former Indiana state insurance commissioner, now at the Georgetown Center on Health Insurance Reforms: “States that are in earnest about implementing the law will likely see lower increases, and states not so concerned about seeing the law succeed will see higher increases.”

 

 

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Study Debunks Claims That Medicaid Patients Abuse Emergency Rooms

Opponents of Medicaid expansion have often distorted reports of increase Emergency Room use after their expansion of the Medicaid program in Oregon as reason to oppose the program. MACPAC, a nonpartisan federal agency that provides policy and data analysis on Medicaid and CHIP to Congress, has found the problem to not be as serious as suggested as the vast majority of the use of Emergency Rooms is for valid reasons. Fierce Health Finance summarized their findings:

The Medicaid population uses hospital emergency departments (EDs) at a higher rate than patients with other forms of insurance, but for the most part such visits are necessary, according to a new report from the Medicaid and CHIP Payment and Advisory Commission (MACPAC).

The report aims to debunk the notion that Medicaid patients show up at the emergency room (ER) for care because they have been conditioned to do so. “The majority of ED visits by non-elderly Medicaid patients are for urgent symptoms and serious medical problems that require prompt medical attention,” the report said. It noted that Medicaid patients tend to have much higher rates of chronic diseases and debilitating conditions than those in the privately insured population, or even among those who lack health insurance altogether. In many cases, their conditions are so compromised that even their primary care physicians will refer them to the ER.

Moreover, MACPAC also engaged in a systematic review of all the research regarding ED use and the Medicaid population between 1990 and 2010. It concluded that there was no “consistent association” between Medicaid enrollees and unnecessary ER use.

MACPAC also noted that some conditions treated at the ER that are classified as non-urgent  are best treated there anyway. “Some problems, such as chest pain in a 50-year old or an infant’s fever and rash, carry high risks for patients and are best evaluated in an ED,” the report said. “This is true even if–after a physician’s evaluation and some rapid testing–the vast majority of cases are resolved.”

Experience from Medicaid expansion in Ohio also showed that better management of the Medicaid patients can lead to better control of chronic disease while limiting Emergency Room use.

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Ohio Experiment Shows Way To Save Money With Medicaid Expansion And Avoid Increase In ER Utilization

Opponents of the expanded Medicaid program have often cherry-picked data from Oregon to point out an increase in Emergency Room use and to question the benefits of the program. NPR’s Morning Edition looked at a program in Ohio to expand Medicaid coverage before the expansion in the Affordable Care Act and found positive results. The program was formed due to the problem of unreimbursed high cost care when uninsured people with problems such as diabetes received their care in the emergency rooms:

So, long before Ohio expanded Medicaid, the hospital redirected more than $30 million it receives from county taxpayers each year into a new pot.

It used the money to create its very own Medicaid program for county residents. And then it tracked the patients.

The results from the first nine months are in.

“All of the clinical outcomes are really amazing,” says , a researcher at MetroHealth.

The hospital used extensive electronic medical records to carefully select uninsured patients and send them Medicaid cards before they even applied. Then MetroHealth gave personalized attention to patients. Cebul says they focused on 18,000 of them who came to the hospital a lot.

“The diabetes outcomes were probably the most impressive,” he says. “The sugar control, the blood pressure control, the lipid control — virtually everything was much better and dramatically so.”

Here’s how it works. Each patient is assigned a nurse. That nurse books their appointments, calls them if they miss one and checks to make sure they take their medications.

In nine months, emergency department visits dropped 60 percent and primary care visits went up 50 percent.

The hospital also ended up spending less than it budgeted, saving an average of $150 on each patient every month.

“Better care, better outcomes, better costs,” Cebul says.

This program is probably showing better outcomes earlier than in Oregon due to increased oversight of the people receiving benefits. If people are just given health care coverage, it takes time to get established with primary care physicians as opposed to utilizing the Emergency Rooms. The experiment in Ohio showed that this problem could be avoided by making a greater effort to supervise the newly insured and actually set them up with primary care doctors.

Not surprisingly, the states which are participating in the expanded Medicaid program are seeing the largest drops in uninsured. It will be interesting to see how the individual states handle their new Medicaid patients, as the program in Ohio has demonstrated that there could be greater potential cost savings when the newly insured receive greater oversight, at least for those with expensive medical problems such as diabetes.

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Reports Show More People Insured But No Increase In New Patient Volume For Physicians Since January Under Affordable Care Act

The New England Journal of Medicine has reviewed the increase in coverage under the Affordable Care Act and concluded:

Taking all existing coverage expansions together, we estimate that 20 million Americans have gained coverage as of May 1 under the ACA (Figure 3Figure 3Categories of Expanded Health Insurance Coverage under the Affordable Care Act (ACA).). We do not know yet exactly how many of these people were previously uninsured, but it seems certain that many were. Recent national surveys seem to confirm this presumption. The CBO projects that the law will decrease the number of uninsured people by 12 million this year and by 26 million by 2017. Early polling data from Gallup, RAND, and the Urban Institute indicate that the number of uninsured people may have already declined by 5 million to 9 million and that the proportion of U.S. adults lacking insurance has fallen from 18% in the third quarter of 2013 to 13.4% in May 2014.

However, these surveys may underestimate total gains, since some were fielded before the late March enrollment surge and do not include children. With continuing enrollment through individual marketplaces, Medicaid, and SHOP, the numbers of Americans gaining insurance for the first time — or insurance that is better in quality or more affordable than their previous policy — will total in the many tens of millions.

As we look to the future of the coverage provisions of the ACA and their effect on the U.S. health care system, several observations seem justified. First, as the number of individuals benefiting from the law grows, its wholesale repeal will grow less likely, although the law could still be importantly modified in the future.

Second, experience with the ACA will vary enormously among states. Those deciding not to expand Medicaid will benefit far less from the law, and since many of these states have high rates of uninsured residents and lower health status, the ACA may have the paradoxical effect of increasing disparities across regions, even as it reduces disparities between previously insured and uninsured Americans as a whole.17

Third, the sustainability of the coverage expansions will depend to a great extent on the ability to control the overall costs of care in the United States. Otherwise, premiums will become increasingly unaffordable for consumers, employers, and the federal government. Insurers who seek to control those costs through increasingly narrow provider networks across all U.S. insurance markets may ultimately leave Americans less satisfied with their health care. Developing and spreading innovative approaches to health care delivery that provide greater quality at lower cost is the next great challenge facing the nation.

The full article is available to non-subscribers and there is also further discussion at Talking Points Memo.

There has been concern that the increase in number of insured might lead to an increase in number of people seeing physicians despite predictions and early evidence that this would not be a significant problem in most areas. I have seen several reports indicating that doctors generally are not seeing more patients as a result of the Affordable Care Act. The most recent came from Athena Health and the Robert Wood Johnson Foundation. Here is a summary of their findings:

  • Influx in New Patient Volume Not Detected: In the first five months of 2014, a national sample of 14,300 health care providers across the athenahealth network did not see an increase in new patient volume.* Instead, the percentage of total visits with new patients actually dropped slightly compared to the same period in 2013. These findings suggest that an increase in newly insured patients, resulting from the ACA, has yet to have an impact on new patient volume at medical practices.
  • Health Care Reform Widening the Medicaid Gap: In states that are expanding Medicaid coverage under the ACA, the data shows an overall increase in adult (18-64) Medicaid beneficiary patient visits. In expansion states, on average, the percentage of Medicaid-covered patients who are being seen by primary care physicians is rising, with Medicaid patients accounting for 12.3% of care in December of 2013 compared with an increased rate of 15.6% in May 2014. Surgeons and other specialists also show increases. Conversely, states that are not expanding Medicaid coverage have seen Medicaid visits remaining flat. These findings indicate that the implementation of the ACA is widening the gap of the total share of Medicaid patients that doctors in expansion vs. non-expansion states are caring for.
  • No Increase in Chronic Disease Diagnoses Among New Patients: Findings from the first five months of 2014 indicate that established patients have a higher rate of chronic diseases compared with new patients seeking care. When comparing diagnosis rates of chronic conditions from the first five months of 2013 to the first five months of 2014, across both new and established patients, no increase in diagnosis rates of chronic conditions is detected for either population.

It is possible that some of the newly insured are initially going to the Emergency Room and therefore are not picked up as an increase in visits by primary care physicians. In May I reported on a study by the American College of Emergency Physicians which found that 37 percent of ER physicians reported that patient volume had increased slightly, 9 percent reported that it had increased greatly, and 27 percent reported that the number of ER visits had remained the same.

It is also a good finding that the newly insured are not turning out to be sicker than the previously insured. Many insurance companies held off on entering the exchanges last year out of fear that they might wind up with sicker patients, costing them more money. Those which sold coverage have wound up doing well with more insurance companies planning to enter the exchanges to sell coverage for next year. This should help reduce anticipated increases in premiums and give consumers more choice.

Forbes has further discussion of the differences in states which are offering the expanded Medicaid program compared to those which do not.

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Medicaid Coverage Varies From One Side Of Town To Another In Some Border Cities

As Annie Lowrey described, which side of town one lives on can determine whether a poor person receives Medicaid benefits if the town is on a border between a state which participates in the expanded Medicaid program and one which does not. The Affordable Care Act provides for expanding Medicaid benefits with the federal government paying most of the cost, but many Republican-controlled states have chosen not to participate in the program:

Arkansas accepted the Medicaid expansion in the Affordable Care Act. Texas did not.

That makes Texarkana perhaps the starkest example of how President Obama’s health care law is altering the economic geography of the country. The poor living in the Arkansas half of town won access to a government benefit worth thousands of dollars annually, yet nothing changed for those on the Texas side of the state line.

After the Supreme Court decided in 2012 that states could not be compelled to expand Medicaid to cover more of their low-income residents, many politicians voiced fears that the poor in states that opted out of the expansion might flood into states that opted in.

Thus far, 26 states and the District of Columbia have chosen to extend Medicaid, encouraged by the promise that the federal government will shoulder 90 percent of the cost indefinitely. The others — including Texas — have so far declined.

But none of the low-income Texarkana residents interviewed realized that moving to the other side of town might mean a Medicaid card. In fact, health researchers and those who work with the poor expect very few Americans to move between states to take advantage of the law.

“It’s impossible to understand what it is to move when you have nothing,” said Jennifer Laurent, the executive director of Randy Sams’ Outreach Shelter, where Ms. Marks is staying until she puts together enough savings from her two low-wage jobs to find her own place. “To risk everything — losing your bed, your sense of community — for an uncertain benefit? There’s no way you want to risk that.”

Research on other expansions of government benefits has borne that out: A study in the journal Health Affairs looked at the “welfare magnet hypothesis” and found no evidence that it exists…

The disparities among states have left about eight million low-income adults ineligible for Medicaid and have widened the difference in what federal safety-net benefits are available to similar families in different states. There are a number of border communities where one state is expanding Medicaid and the other is not: West Memphis, Ark., and Memphis; Chicago and Gary, Ind.; Washington’s Maryland suburbs and those in Northern Virginia; and Spokane, Wash., and Coeur d’Alene, Idaho.

There is currently a battle in Virginia over whether to accept the program. In order to prevent this, the Republicans are attempting to flip the state Senate by offering a Democratic member what might be an illegal bribe to step down.

The expanded Medicaid program is both providing many people with needed health are coverage, and is also improving profits for hospitals which no longer have to provided reimbursed care.

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A Fact Checker Responds To Mitch McConnell’s Dishonesty On Obamacare

In response to the issue discussed yesterday where Mitch McConnell simultaneously opposed the Affordable Care Act and supported Kynect, the computer exchange set up in Kentucky as part of the Affordable Care Act, Glenn Kessler exchanged email with Jesse Benton, McConnell’s campaign manager. Benton made some absurd statements such as that,  “When Obamacare is repealed, Kentucky can choose to continue Kynect or alter it in a way that makes the best sense for Kentuckians.” As discussed yesterday, Kynect cannot exist without Obamacare.

Benton also tried to separate the benefits of the expanded Medicaid program from the Affordable Care Act:

Medicaid existed before Obamacare and will continue to exist after repeal. Kynect is not Medicaid. It is a state administered exchange that provides a marketplace for private insurance plans.  While some 300,000 Kentuckians discovered they were eligible for Medicaid through Kynect, they do not purchase private insurance through the exchange; they are enrolled in the state-administered program.

The expansion of Medicaid is another aspect of the Affordable Care Act, with the federal government paying the bulk of the cost of this expansion. If Obamacare is repealed, there would not be either Kynect or the expanded Medicaid program which many in Kentucky have benefited from.

Benton also claimed that people in Kentucky “would move back to HSA’s and other higher deductible plans they had pre-Obamacare to receive a higher quality of care.” However there were no previous plans for most of these people as 75 percent of the newly insured in both Medicaid and the exchange were previously uninsured. High deductible plans and HSA’s work well for upper income individuals, but they are not a good solution for those with lower incomes who cannot afford to pay high deductibles or place money in HSA’s.

Kessler concluded:

McConnell appears to have accepted the Medicaid expansion that has been so embraced by his state’s residents, while drawing a distinction with the Obamacare health plans sold on the statewide exchange. Given that three out of four of the newly insured in Kentucky ended up on Medicaid, that probably makes political sense—and also is newsworthy.

But the history of individual state exchanges shows it is not credible for McConnell to suggest that the state exchange would survive without the broad health-care system constructed by the Affordable Care Act, such as an individual mandate and subsidies to buy insurance. Given the popularity of the state exchange, McConnell appears to want to offer out hope it would continue even in the unlikely case the law was actually repealed. That’s likely not a tenable position, and we will pay close attention to McConnell’s phrasing on this issue in the future. The senator is clearly trying to straddle a political fence; when doing so, it’s easy to lose your balance.

I do find it strange that Kessler decided to review the exchange with the above conclusion “rather than a traditional fact check.” These statements from McConnell and his campaign manager are clearly dishonest. Kessler has declared statements which were far more ambiguous to be dishonest in the past. I do applaud his decision to concentrate on reviewing the facts as opposed to jumping to awarding Pinocchios, but hope that this new policy applies to both parties.

In related news, a new Wenzel Strategies poll (a Republican pollster with a reputation for a strong pro-Republican “house effect”) has Mitch McConnell leading Democratic challenger Alison Lundergan Grimes by 47 percent to 44 percent. The closeness of the race is encouraging but it is hard to see Kentucky voting in a Democratic senator.

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Medicaid Expansion Leading To Increased Care For Poor And Increased Revenue For Hospitals

After Medicaid was expanded in Oregon prior to the passage of the Affordable Care Act there was an increase in Emergency Room visits from people using their new coverage. This was not surprising and the challenge was to get those with the new coverage both established with primary care physicians and to get the Medicaid patients in the habit of seeing a primary care physician as opposed to over-utilizing Emergency Rooms. This raised questions as to whether we would see a similar initial increase in Medicaid utilization of Emergency Rooms with the expansion of Medicaid coverage under the Affordable Care Act. So far there are optimistic reports regarding the effects of Medicaid expansion.

A recent survey conducted by the American College of Emergency Physicians found that 37 percent of ER physicians reported that patient volume had increased slightly, 9 percent reported that it had increased greatly, and 27 percent reported that the number of ER visits had remained the same.  Only 3 percent reported an increase in patients with private insurance  while 35 percent reported an increase in patients with Medicaid. This could be an indicator that those with Medicaid were having more difficulty than those with new private insurance in finding private primary care physicians. This might also be partially due to patients receiving Medicaid being poorer and sicker and in greater need of emergency services.

Kaiser Health News reported on more promising news for those receiving Medicaid. They found that safety-net hospitals were seeing more paying patients due to more poor patients receiving Medicaid, and these hospitals were therefore bringing in more money.

One of the biggest beneficiaries of the health law’s expansion of coverage to more than 13 million people this year has been the nation’s safety-net hospitals, which treat a disproportionate share of poor and uninsured people and therefore face billions of dollars in unpaid bills.

Such facilities had expected to see a drop in uninsured patients seeking treatment, but the change has been faster and deeper than most anticipated— at least in the 25 states that expanded Medicaid in January, according to interviews with safety-net hospital officials across the country.

“This is really phenomenal,” said Ellen Kugler, executive director of the National Association of Urban Hospitals, based in Sterling, Va., which represents inner-city safety net institutions. “It shows the Affordable Care Act is clearly working in these locations.”

Safety net hospitals, most of which are government-owned or nonprofit, have typically struggled financially because their urban locations mean they treat more uninsured patients who show up in emergency rooms and cannot be turned away.

An Urban Institute study published in the May edition of Health Affairs estimated the costs of uncompensated care to hospitals were as high as $45 billion in 2013. Government programs helped defray 65 percent of those costs, the study estimated.  That left providers billions of dollars in the hole.

They also found that more were receiving care from primary care physicians as opposed to from Emergency Rooms:

Hospital officials say the biggest impact of the change is on patients themselves. Rather than having to rely on emergency rooms, newly insured patients can see primary care doctors and get diagnostic tests and prescription drugs, among other services.

Some safety-net hospitals say they started to see their numbers of uninsured patients dropping almost immediately after the Medicaid expansion took effect in January.

“We have seen a steady decline in our uninsured visits,” said Roxane Townsend, CEO of UAMS. “We did not anticipate this big a drop this quickly.”

About 80 percent of the system’s new Medicaid patients had previously been seen by the hospital as uninsured patients, she said. Their enrollment in coverage means the hospital is paid more for their care and is able to direct them to outpatient services and preventive care.

She said that UAMS has also seen a drop in ER visits by uninsured patients — from 6,000 visits in first three months of 2013 to about 4,000 visits in first three months of this year, calling the decline “significant.”

While some emergency physicians have offered anecdotal reports of increased use of the ER since January, there is no documentation of the health law’s impact yet. Studies examining ER use in Massachusetts following that state’s expansion of coverage showed an initial surge followed by a decline in those numbers over several years.

Denver Health officials said the increase in insured patients since January — most of whom are enrolled in Medicaid – appears to be boosting the number of people seeking care at its primary care clinics, rather than through the emergency room.

Patient visits to Denver Health primary care offices are up 14 percent this year, while ER visits are down 2 percent. Patient visits for mental health and substance abuse services are also up nearly 50 percent.

“Patients are seeking care at better and more cost-effective and more appropriate settings,” said Peg Burnette, chief financial officer at Denver Health.

This trend was not limited to safety-net hospitals. For-profit hospitals are also benefiting from increased coverage:

Although safety-net hospitals may be experiencing the biggest impact from the expansion of coverage, the improvements are not limited to them.

Investor-owned hospital companies HCA, Tenet Healthcare Corp., Community Health Systems (some of which own safety-net hospitals) say they saw their rates of uninsured patients drop by as much as a third in the first quarter of 2014 in hospitals located in Medicaid-expansion states.  HCA said its hospitals in states that chose not to participate in the health law’s expansion of the program saw rates of uninsured patients rise by 6 percent.

LifePoint Hospitals, a Brentwood, Tenn.-based company that owns 60 hospitals nationwide, said the Medicaid expansion led to an average 26 percent reduction in uninsured patients at its facilities.

“It’s been a big financial help,” said Chief Financial Officer Leif Murphy, noting the reduction will help offset the health law’s Medicare funding cuts.

Converting patients from no cash to some cash “is a good thing,” said Sheryl Skolnick, a hospital analyst with CRT Capital Group in Stamford, Conn.

The exception to this trend is in states where Republicans have blocked Medicaid expansion. This is especially foolish as the federal government pays most of the cost, with states, along with hospitals, benefiting from the decrease in uninsured. Salon reported over the weekend on efforts in Georgia, also being seen in other Republican states, to make it more difficult to expand Medicaid in the future by requiring that the decision be made by the state legislature as opposed to by the governor. The conservatives Republicans don’t want to gamble on a Democrat, or even a rational Republican, becoming governor in the future and deciding to accept the federal funds to expand Medicaid.

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