Research Provides Stark Comparisons for Medicaid Expansion

When PPACA politics trumps PPACA policy, hospitals and patients pay the price.

Sometime Wednesday the U.S. House is expected to pass yet another bill to repeal the Patient Protection and Affordable Care Act. President Obama has already said he will veto Senate companion legislation, which means the House vote is purely symbolic. After more than 60 unsuccessful attempts to repeal the bill, what this latest vote actually symbolizes I will leave for others to decide.

Meanwhile, in the real world, a couple of studies released this week illustrate the stark differences in healthcare access and cost between some of the states that have expanded Medicaid under the PPACA and some of the 20 states that have not.

In one study, sponsored by The Commonwealth Fund and issued this week in Health Affairs,  Harvard University researchers compared the experiences of about 5,600 low-income adults living in Kentucky, Arkansas, and Texas in late 2013 and late 2014. Within that 12-month window, Arkansas expanded Medicaid using federal funds to buy health insurance through the ACA's marketplaces, Kentucky expanded eligibility for its traditional Medicaid program, and Texas held firm as a non-expansion state.

Many of the Harvard findings are what you'd expect, but still worth noting:

• The uninsured rate in Kentucky and Arkansas fell 14 percentage points more than in Texas from 2013, before the full implementation of the coverage provisions, to 2014, after the expansion's full year. The uninsured rate for low-income adults was about 40% in all three states in 2013 but had dropped to 19% in Arkansas, 12% in Kentucky, and 27% in Texas in 2014.
• The number of people in Kentucky and Arkansas who reported having trouble paying medical bills fell nine percentage points more than in Texas from 2013-14, while the numbers of people who reporting skipping a prescription because of cost fell 10 percentage points, respectively, in the same timeframe.
• The number of adults with chronic conditions such as high blood pressure or diabetes who reported receiving regular care climbed almost 12 percentage points in Arkansas and Kentucky than in Texas.
• The share of people who reported that the emergency room was their usual access point for care was about 9.6% in all three states before the expansion. However, that figure dropped five percentage points in Arkansas and Kentucky, when compared with Texas. At the same time, demand for outpatient visits in expansion states pushed overflow into the emergency rooms. As a result, the number of people who said they used the ER because they couldn't get an outpatient appointment rose nearly five percentage points in Kentucky and Arkansas.

A second study by University of Michigan researchers, also appearing this week in Health Affairs, found huge drops in the amounts of uncompensated care delivered by hospitals in expansion states just six months after opening the roles to more low-income people.

"This study provides evidence that expanding Medicaid eligibility matters more than how it is expanded, on most indicators," Commonwealth Fund President David Blumenthal, MD, said in remarks accompanying the study. "As states that have not yet taken steps to expand their programs weigh their options, these findings demonstrate the value of Medicaid in making healthcare more accessible and affordable. New approaches to expanding Medicaid should be monitored to ensure these goals are being achieved."

U-M Study Tracks Uncompensated Care
The University of Michigan study in Health Affairs found that between late 2013 and mid-2014 hospitals in expansion states saw a huge drop in uncompensated care, and a rise in care for patients with coverage, when compared with non-expansion states.

Using a new data source from the Agency for Healthcare Research and Quality's HCUP Fast Stats program, the U-M study examined hospital discharges in the expansion states of Arizona, California, Colorado, Hawaii, Iowa, Kentucky, Minnesota, New Jersey, and New York and found that hospital stays by uninsured patients went down 50%, and stays by people with Medicaid went up 20% over the six-month period that was examined.

Not surprisingly, it was just the opposite in the non-expansion states of Florida, Georgia, Indiana, Missouri, Virginia, and Wisconsin, all of which continued to experience the same or higher demand for uncompensated care.

For example, Kentucky, where Medicaid enrollment has nearly doubled since expansion, saw a 13.5 percentage point drop in uninsured hospital stays in the first six months after expansion. Georgia, a non-expansion state, saw a seven-point rise in uninsured hospital stays in early 2014.

"In expansion states, we see exactly what we would expect to happen after Medicaid became available to more people," Sayeh Nikpay, PhD, MPH, lead author of the U-M study said in remarks accompanying the release. "Even in these early months, the shift from uninsured to Medicaid contrasts sharply with the steady demand for uninsured care in non-expansion states. This has implications for the financial status of hospitals."

PPACA Politics Trumps PPACA Policy
It became obvious early in this process that the policy argument against Medicaid expansion has no legs. That's because it's never been about anything beyond partisan politics. Studies such as these from Harvard and U-M simply verify what we already know—that a chasm in healthcare coverage and access and reimbursement now exists between expansion and non-expansion states.

Yes, Medicaid has any problems, including low reimbursement. However small that reimbursement, it's better than uncollectable bad debt or charity care write-offs. Medicaid does not create a healthcare need. It provides a funding mechanism, however flawed, to pay for a healthcare need that already exists and that we pay for though cost-shifting and other opaque schemes.

For those who dislike traditional Medicaid, the Centers for Medicare & Medicaid Services has shown flexibility. As noted in the Harvard study, Arkansas used its Medicaid expansion money to extend private market coverage for low-income people. Conservative state leaders in that dark red state should be congratulated for putting politics aside and finding a solution. They demonstrated what can be accomplished with compromise.

Sadly, the political leadership in 20 states has yet to muster the courage to act. Those most affected by the obstinate refusal to expand Medicaid coverage are also the most vulnerable and sickest among us, and the hospitals and other providers who serve them.