Bacon's Rebellion

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More Reason for Cynicism about Medicaid Expansion

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by

James A. Bacon
in

Sentara Norfolk General Hospital: emergency room admissions up 7%

by James A. Bacon

More than 300,000 Virginians have something today they didn’t have last year — health insurance through Medicaid, observes Virginia Public Radio. What they don’t have is a primary care physician. Many are still seeking primary care treatment at hospital emergency rooms.

Admissions to the emergency room of Norfolk General Hospital have increased 7% this year. One hoped-for benefit of Medicaid expansion is that more patients would seek treatment outside the emergency room, one of the most expensive settings for medical treatment. Clearly, that benefit has not materialized. “There’s a whole behavior modification and teaching and education that needs to happen,” says Sentara Norfolk General President Carolyn Carpenter.

Yeah, that…. and there’s a Medicaid-patients-finding-a-doctor thing that needs to happen, too. Due to low reimbursement rates, many primary care physicians cap the number of Medicaid patients they treat.

One would think that Governor Ralph Northam, a physician, would appreciate this. But other than allowing more latitude for nurse practitioners to treat patients, I have seen no remedies proposed by Virginia’s ruling class to address the most significant of all barriers to health care. The inaction calls into question how serious people really are about expanding real health care coverage for the poor.

In retrospect, Medicaid expansion increasingly looks more like a gimmick designed to accomplish two goals: (1) generate a major new income stream for special interests in the health care sector, while (2) allowing the ruling class to pose as champions of the poor.

Virginia hospitals are now flush with Medicaid cash. An oft-touted benefit of expansion was that hospitals would reduce their losses from charity care and uncompensated care, which would allow them to… Well, it was never clear exactly what hospitals would do, but the results were implied to be socially beneficial. However, as recent news reports have highlighted at Mary Washington hospital and the University of Virginia health system, at least some hospitals have been pursuing collections as aggressively as ever. (Trust me, they aren’t the only ones.) Due to lengthy reporting delays, Virginians won’t know the impact of Medicaid expansion on hospital profitability for another couple of years, but I’ll hazard a guess — revenues and profits will surge.

Meanwhile, hospitals are helping finance Medicaid expansion (the bulk of the funds are coming from the federal government) through a tax on revenue. No word yet on how the industry is absorbing that tax. But I’ll hazard a guess — they’re passing on most of it to payers of private insurance.

Another beneficiary of Medicaid expansion is the medical insurance industry. Rather than rely upon the inefficient fee-for-service system, DMAS is outsourcing managed care programs to private insurers. Maybe those plans will provide enrollees superior access to primary care physicians, maybe they won’t. We’ll have to wait and see. But I’ll hazard a guess — emergency room visits will continue growing.

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11 responses to “More Reason for Cynicism about Medicaid Expansion”

  1. V N Avatar
    V N

    Its ridiculous. Put a level of profit they are allowed to make and not allow them (or Dominion Power) to weasel out of it. Then have the poor pay a portion of their funds. Skin in the game.
    I think there will probably end up being some sort of limit because we can’t not treat diabetes but then fund so much mental health issue. I am waiting for the bottom to drop and it go down a road people won’t like but will have to accept: ie Venezuela and Soviet Russia.

  2. Peter Galuszka Avatar
    Peter Galuszka

    Where did the seven percent figure come from? What time period?

    1. James A. Bacon Avatar
      James A. Bacon

      Don’t know where that figure came from — I took it from the Virginia Public Radio article, which, I presume, got it from Sentara.

  3. LarrytheG Avatar
    LarrytheG

    re: ” Meanwhile, hospitals are helping finance Medicaid expansion (the bulk of the funds are coming from the federal government) through a tax on revenue. No word yet on how the industry is absorbing that tax. But I’ll hazard a guess — they’re passing on most of it to payers of private insurance.”

    first – good journalism cites the source of what it prints.

    but to this point – no one in BR has said how the Medicaid Expansion is funded – and that’s a key issue especially if one is
    going to speculate that it’s passed on to employer-provided without any substantiation.

    The first thing this blog should do is to identify the source of the funds for Obamacare and the Medicaid Expansion in my view – or at the least don’t just make wild speculation about it.

    One of the problems with the expansion – is the rampant conflation of other things going on like ER visits – with the expansion with scant evidence that the expansion is actually responsible for it.

    It’s just throwing all kinds of stuff up on the wall – by those who are basically opposed to the concept of it – and they have no alternatives. If they actually had alternatives – a valid debate about the best path forward could occur but to this point it’s all about just conflation and unsubstantiated blame game blather.

    People who have employer-provide – ALSO go directly to the ER rather than their doctor who is “covered” because they think their insurance will pay for it. They’re more likely to do that, in fact, that those who don’t have insurance and KNOW that the hospital is going to try to collect BEFORE they write it off.

    Yet we continue to get this same narrative about Medicaid and ERs.. without real evidence much less any real fact-based discussion of who goes to ERs and who doesn’t pay. Most everyone , those who have coverage and those who don’t KNOW that the hospital is going to bill you – AND they’re going to try to collect. What the MWC and UVA experience shows is that they are going to try to collect – because SOME Of those folks actually do have insurance and do have assets and collection is feasible.

    But those who pontificate against the expansion – they have no alternative approaches to the problem – they just argue against Medicaid… I’d like to see some honest alternatives proffered and no not idiotic stuff from conservative or libertarian folks who are totally disconnected from reality.. we need real alternatives – we got enough blamers without alternatives…

  4. Peter Galuszka Avatar
    Peter Galuszka

    Ouch!

  5. TooManyTaxes Avatar
    TooManyTaxes

    Free sells well. It also buys votes. What else needs to be said?

  6. Dick Hall-Sizemore Avatar
    Dick Hall-Sizemore

    The 7 percent increase, by itself, proves nothing. What has past experience been? Perhaps the 7 percent increase is a smaller increase than in past years, leading to the possibility that Medicaid expansion actually did lead to fewer ER visits.

    I have little sympathy for hospitals over the ER issue. They used to try to discourage folks from going to the ER because of the high cost. Now, it is impossible to travel an interstate or major roadway without seeing a billboard advertising a hospital with an ER with a a wait time of only (7, 8, 10) minutes. It seems as if they are competing to see who has the ER with the shortest wait period. Now, another thing. Suppose that you are a parent with a kid screaming from an awful earache–which would you choose, the ER advertising a wait time of 7 minutes or your doctor’s office where you know you will have to wait at least 30 minutes because you don’t have an appointment?

    Finally, Jim seems to want to have it both ways. The new Medicaid patients will have trouble finding doctors because few doctors will take Medicaid patients because of the low reimbursement schedule, while hospitals will be rolling in cash because of the additional Medicaid patients.

  7. James A. Bacon Avatar
    James A. Bacon

    “Jim seems to want to have it both ways. The new Medicaid patients will have trouble finding doctors because few doctors will take Medicaid patients because of the low reimbursement schedule, while hospitals will be rolling in cash because of the additional Medicaid patients.”

    Nothing contradictory at all about those two statements. Hospitals are not allowed by federal law to turn patients away. If patients have Medicaid, hospitals will get revenue that they previously wrote off as uncompensated care. Situation with doctors is very different. Doctors aren’t required to take patients or provide uncompensated care.

    A further point, which I need to confirm, but I have heard during informal chit-chat with a hospital administrator that the state has upped its Medicaid reimbursements to hospitals to a level commensurate with Medicare — but has not done the same thing with doctors. Again, I need to confirm that. But for sure there is a lot going on behind the scenes that has not been reported.

  8. Reed Fawell 3rd Avatar
    Reed Fawell 3rd

    If I read this post and commentary right, then all boiled down, the key is that:

    1. The hospitals have rigged the system so that they are making out like Bandits, are flush and rolling with cash, and running wild and roughshod over patients, and taxpayers;

    2. The primary care physicians, save for those few primary care physicians who serve the very affluent (the rich), are getting screwed four ways to Sunday, to the extreme extent that primary physicians for the poor and middle class are being run out of business, leaving only the incompetent, and corrupt left, save for heroic few, many including nurses, medical technicians, young idealists, and dwindling number older primary care doctors who refuse to retire or otherwise leave their patients to the wolves who otherwise will abuse their patients.

    3. The plain fact is that honest, competent, and caring primary care physician are the one Critical and Irreplaceable component that holds the entire health care together and to account, and keeps the entire system honest. Thus poor and indeed now the entire middle and most of the upper middle class need good, reliable, targeted, honest, affordable, and caring holistic health guaranteed by strong effective primary care physicians.

    Otherwise, without this strong cadre of primary care physicians, patients are far too often thrown to the wolves, an unsupervised and unregulated pack of specialists who increasingly care nothing for their patients who likely they know not at all as human beings, but only as a target rich environment of ill advised sick people who give specialist that means to make money for his or her specially and hospital, where everyone is competing for business, and on a chase of ever more power, prestige, money, and profit.

    So here, yet again, the rich in power have gamed the entire health system to get richer themselves while putting at great risk and expense the poor and middle class that in this case comprise 95% of the population.

    One terrible result of this is that without a powerful and effective cadre of primary care doctors, the entire health care industry runs wild on a money chase, doing unnecessary and ill advised tests, procedures, and operations that far too often the patient does not need, and that do the patient great harm, if only because the patients real problems and solutions are being grossly ignored in many cases, and quite likely in most cases, save where the patient is rich enough and demanding enough to afford one on the few competent primary care physicians around, or has the time, smarts, money, and type A personality to take care of himself and family. Yet, again the rich and powerful abuse and feed off another American institution, at the expense of their fellow citizens, and each it gets worse as they ruthlessly refine and tailor that system to serve their own interest at everyone else’s expense.

    Hence, the health care system in this country, for most peoples, is upside down, and corrupt as American higher education.

  9. Reed Fawell 3rd Avatar
    Reed Fawell 3rd

    This is not to say that there are not many fine specialists. What it does say is that current structure as it is designed and refined over time, leaves a system that is wide open for abuse. The very recent charging and bill enforcement against patients scandal at UVa. hospital is a result and manifestation of the mind set at play, the relentless focus in the health care industry on money making that invariable overtakes these institutions, given the great unsupervised power under their control. Often the sense of this problem reeks as one walks around some of these places, while at other institutions one gets a far more positive sense of how the place is run.

  10. Reed Fawell 3rd Avatar
    Reed Fawell 3rd

    One of the glories of modern civilization, and great threats to our civilization, is the now immense and rapidly growing power of computer analytics. Think about it.

    One the one hand, today’s computer analytics create and deploy wondrous medicines and medical procedures that were only dreamed of (or never dreamed of), before the turn into the 21th century.

    On the other hand, today’s commuter analytics can dissect, slice and dice, and rearrange and redirect profit and loss, with incrediable precision within a health care system, and do the same within a highly complex university, so as to benefit only a very small slice of people, while those analytics work to humiliate, demean, diminish, and even render extinct, all competition to those few in control who wield the power of those analytics.

    This is why, in the health care industry, the power, control, authority, and competency of the primary care physician are being systematically destroyed. And it’s why the Administrators, insurers, and favored specialists are getting ever richer, ever more arrogant, and ever more out of control, while they serve not their original charter, but only themselves.

    And,

    This is why, in the field of higher education, the humanities, and the teaching of a solid and meaningful education to undergraduate students, has been largely destroyed and/or mutilated into a monster of toxic nonsense, save for STEM, and a few on the run professors who are the last stand remnants of the 20th century, those raggedy few akin now to Graham Greene’s Whiskey Priest in The Power and the Glory.

    Left to feast on the dead body of education are the Administrators, the supreme tenured research faculty, and those who support tje.

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