Exchanging Medicaid for a Better Option in Georgia
A Washington Post article paints a dire picture for safety net hospitals in states that don’t expand Medicaid. The article uses Atlanta’s Grady Memorial Hospital as an example the plight of a hospital without expansion:
If Georgia expanded Medicaid, Grady chief executive John Haupert says it would cover more than 27,000 uninsured patients now seeking free medical treatment at the hospital. It also would have helped the hospital with an estimated $60 million economic boon.
What the article neglects to explain is that many of the people who would be forced into Medicaid will now have the opportunity to enroll in highly-subsidized, private coverage in the health insurance exchange. Private insurers in Georgia pay physician fees that are about 40% higher than what Medicaid pays for the same service. Using this ratio as a proxy for the higher insurance reimbursement, according to NCPA analysis Georgia doctors and hospitals would enjoy more than $2 billion over a decade in additional spending on the uninsured living at or above poverty compared to Medicaid if they had private coverage rather than Medicaid.
“Private insurers in Georgia pay physician fees that are about 40% higher than what Medicaid pays for the same service.”
Wouldn’t this be saving the pocket of the patient and taxpayer in a sense? I am not sure I follow the logic here, which I may be misinterpreting.
This is a bit hard to follow, but the logic is clear. The message is always the same… get a heath savings account.
I didn’t realize he was talking about getting HSA’s here…?
“Private insurers in Georgia pay physician fees that are about 40% higher than what Medicaid pays for the same service”
– We need to find solutions to problems like this.
Medicaid is just another bottomless pit for us in the entitlement scam.
This analysis is important for at least two reasons:
1) A massive influx of Medicaid enrollees would have difficulty finding doctors willing to treat them for the low fees Medicaid pays.
2) Doctors often report they can only afford to cross-subsidize the care of Medicaid patients if Medicaid patients are few in numbers and the majority of a physician’s practice is treating (more highly reimbursed) privately insured patients.
The bottom line: If Medicare fees are slashed below Medicaid fees; and if half the newly insured are covered by Medicaid enrollees, over time the U.S. health care system will become a two-tiered system.
“Georgia doctors and hospitals would enjoy more than $2 billion over a decade in additional spending on the uninsured living at or above poverty compared to Medicaid if they had private coverage rather than Medicaid.”
That’s a lot of money.
If doctors and hospitals could be enjoying over $2 billion in spending in Georgia, then they should welcome it right away!
Sounds like an projection hard not to follow..
Are the low fees below what doctors want to accept or below the level of them making a profit?
Yes to the former and sometimes yes to the latter. Gross margins will vary from one physician office to another. Most physician offices would lose money treating just Medicaid patients. But may not lose money at the margin treating a few.
Assuming they have more patients than they can treat, doctors tend to limit patients covered by different payers to a ratio of high-payers to low-payers. For instance, doctors may continue to treat current patients on Medicaid; but accept no new ones. Physicians may accept all privately insured patients; but not accept every new Medicare enrollee who calls for an appointment. Doctors often reserve appointment slots for those with emergencies (or possibly reserve for those with private coverage and space out appointments for others when schedules are tight).
For example, most family physicians could easily fill their entire practice (say, 3,000 patients) with Medicare and Medicaid enrollees. But Medicaid pays about half of what private insurers pay and Medicare pays only about 80% of what private insurers pay for the same service. Worse yet, Medicare enrollees often have multiple problems and can take twice as long during an encounter as a relatively healthy, privately insured patients.
I’ve also heard physicians complain Medicaid patients are more likely to be no-shows so there’s a tendency to over-book, and schedule them throughout the day.
Most doctors I’ve talked to say they feel it’s their duty to treat some Medicaid patients despite the paltry physician fees. But, like other acts of charity, there are limits to what they feel they can afford to do — and what others should expect them to do.
If I recall correctly, there’s a boo-boo in ObamaCare where people making between 100% and 130% of the poverty level aren’t covered by subsidies. Those are only for people making over 130%! Those 100-130% people were supposed to have been covered by the Medicaid expansion. So they will now have the opportunity to enroll in completely NON-subsidized, private coverage in the health insurance exchange, which they couldn’t afford in the first place.
This isn’t difficult. Bottom line is that government pretends to pay. For evidence, look at areas in which hospitals have closed or dropped services. Absent insane regulation, people in those areas are predominantly covered by Medicaid or Medicare.
At the same time, new hospitals are/were being build in areas in which most people are privately insured. This suggests that one payer system is reasonably healthy. And that one is not.
So, switch a whole bunch of people from private to public pay and one can reasonably expect the quality of care to fall to match the payments. And by quality I means waits, facility quality, staff quality etc.