Medicaid Expansion: The Sky Isn’t Falling

ACA may cause spike in ED traffic, but Medicaid (‘some pay’) is better than ‘self pay’

See counterpoint by Mark Plaster here

The newest release from the Oregon Health Insurance Experiment seems to portend doom for both emergency medicine and the Affordable Care Act [1]. Even the New York Times’ headline is scary: “Emergency Visits Seen Increasing With Health Law [2].” Fortunately, things simply are not that bad.

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First, the newest study on the Oregon Medicaid expansion only answers a very focused question: if you give previously uninsured people Medicaid, they use the ED more. The study authors took advantage of the “natural” RCT that occurred when Oregon used a lottery to expand Medicaid access to about 10,000 residents in 2008. Over the first 18 months, lottery winners’ ED use increased by 40% compared to those who stayed uninsured, from an average of 0.68 to 0.95 visits per year per person. But that’s pretty much all that happened in Oregon at the time – some people who did not have any insurance were given Medicaid and nothing else changed and, surprise, when you give people increased access to care, people access increased care.

What happened next is much more informative, and likely closer to what we will see nation wide since the ACA is much more than simply an expansion of Medicaid. In addition to creating a viable non-group market for insurance, the ACA also takes a number of small but important steps in improving and coordinating care delivery. In 2012, Oregon divided their Medicaid program into 15 regional “coordinated care organizations,” each given a lump sum (i.e. bundled payment) to care for their Medicaid population, and as the name suggests, coordinate their care. These CCOs increased Medicaid primary care visits by 18%, while decreasing CHF admissions by 29% and COPD admission by 28% – all while decreasing ED visits by 9% and decreasing spending growth by 1% [3]. And this is just the sort of care delivery and payment innovation that the ACA encourages.

As the ACA increases insurance coverage, where will those who gain health insurance get their care? This is particularly salient as many of the newly insured will gain insurance through Medicaid. Another recent New York Times article addressed this question, pointedly titled “Medicaid Growth Could Aggravate Doctor Shortage [4].” The article notes that many specialists – and primary care physicians – already do not accept new Medicaid patients due to low reimbursements. Will expanding Medicaid coverage really change much? Will those newly enrolled in Medicaid simply show up in the ED? And for those who we do see in the ED, where will we send our new patients for follow up and specialty care?

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As with most discussions about the ACA, the key is the comparison. Where were these patients getting care before? Or, put another way, what sort of insurance did these patients have before the ACA?

The simple answer is: none. Most Americans gaining coverage due to the ACA would otherwise still be uninsured. Some had private insurance before, but about three times as many were uninsured [5].

(Not surprisingly, it’s a bit more complicated, as “the uninsured” is not a static block of 50 million Americans, but rather a dynamic group who “churns” in and out of insurance coverage [6].)

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It is no surprise that new Medicaid enrollees will have some degree of trouble accessing healthcare, but access to specialists has long been a problem for Medicaid. However, most of the new Medicaid enrollees will come from the previously uninsured [5]. While Medicaid may not provide optimal access to specialists, does anyone really think the new Medicaid enrollees will be worse off than they were when they were uninsured?

It does not take a PhD in health economics to deduce why Medicaid does not guarantee amazing specialty access: it’s nearly all due to Medicaid’s low reimbursements [4,7]. But even if Medicaid pays specialists poorly, it certainly pays better than nothing, which is what most “self-pay” (read: no pay) patients actually pay [8].

If Medicaid’s enrollees now have insurance but not specialty access, will EDs be run into the ground? Probably not. The Medicaid expansion is likely to be a boon for ED finances. In states that expand Medicaid, EDs will be able to collect an estimated 17% more from the previously uninsured [9]. Even if EDs end up with a big boost in patient volumes, something is certainly better than nothing.

Additionally, the experience in Massachusetts suggests that insurance reform will not cause a run on the emergency department. While the absolute number of ED visits did increase after Massachusetts’s healthcare reform, again, it is the comparison that is important. The increase in ED visits in Massachusetts was less than the increase in neighboring states and in the rest of the country. After implementing healthcare reform from 2006-2007, ED visits in Massachusetts increased, rising between 6.7% from 2006-2009 [10,11]. But ED visits have been increasing everywhere. According to numbers from the CDC’s National Center for Health Statistics, there were 119 million ED visits in 2006 [12] and 136 million in 2009 [13], an increase of 14% nationwide. While total ED visits went up in Massachusetts, they increased less than they did across the country. In fact, when looking not at total ED volume but the per capita ED visit rate, individuals in Massachusetts were actually less likely to go to an ED after state healthcare reform [14,15].

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If Medicaid provides such terrible access to care, how can this be the case? The answer is twofold: first, coverage expansion in health reform is not restricted to Medicaid. Second, Medicaid access issues are overblown. First of all, many physicians do, in fact, take Medicaid. While some studies support the conventional wisdom that “physicians are less likely to see new Medicaid patients than those with private coverage or, if they will see them, they offer appointments further in the future [16],” the rates of acceptance of new Medicaid patients are in the neighborhood of 90% or greater, particularly for patients referred from the ED.7,16 Patients with Medicaid have access to care that is much closer to the privately insured than the uninsured [16,17].

Is the ACA perfect? No. Will the newly insured have unfettered access to all the primary and specialty care they need? Of course not. Will emergency departments absorb some of the increase? Of course. But will the ACA mean that EDs across the country will collapse from the burden of a spike in Medicaid patients? Absolutely not. In fact, things will probably be a bit better for us, as some of our patients improve from “self-pay” to “some pay [9,18].”

REFERENCES

1. Taubman SL, Allen HL, Wright BJ, Baicker K, Finkelstein AN. Medicaid Increases Emergency-Department Use: Evidence from Oregon’s Health Insurance Experiment. Science. 2014 Jan 2.
2. Tavernise S. Emergency Visits Seen Increasing With Health Law. New York Times. Jan. 2, 2014. http://www.nytimes.com/2014/01/03/health/access-to-health-care-may-increase-er-visits-study-suggests.html
3. Early data show Oregon Health Plan shifting from emergency care to primary care and holding down costs. Nov 6, 2013.  www.oregon.gov/oha/news/Documents/2013-1106-metrics-report.pdf
4. Goodnough A. Medicaid Growth Could Aggravate Doctor Shortage. The New York Times. Nov 29, 2013. www.nytimes.com/2013/11/29/us/lack-of-doctors-may-worsen-as-millions-join-medicaid-rolls.html
5. Quick Take: Who Benefits from the ACA Medicaid Expansion? Kaiser Family Foundation. Jun 14, 2012. http://kff.org/health-reform/fact-sheet/who-benefits-from-the-aca-medicaid-expansion/
6. Short PF, Graefe DR. Battery-powered health insurance? Stability in coverage of the uninsured. Health Aff. 2003 Nov-Dec;22(6):244-55.
7. Rhodes KV, Bisgaier J, Lawson CC, Soglin D, Krug S, Van Haitsma M. Patients who can’t get an appointment go to the ER: access to specialty care for publicly insured children. Ann Emerg Med. 2013 Apr;61(4):394-403.
8. Betbeze P. Solutions for the No-Pay Self-Pay Patient. HealthLeaders. May 2012. http://coverageforall.org/news/2012/05/15/solutions-for-the-no-pay-self-pay-patient/
9. Galarraga JE, Pines JM. Anticipated Changes in Reimbursements for US Outpatient Emergency Department Encounters After Health Reform. Ann Emerg Med. 2013 Oct 23.
10. Chen C, Scheffler G, Chandra A. Massachusetts’ health care reform and emergency department utilization. The New England Journal of Medicine. Sep 22 2011;365(12):e25.
11. Massachusetts Emergency Department Visit Volume, FY2005-FY2009. Massachusetts Division of Health Care Finance and Policy. http://www.mass.gov/chia/docs/r/ed/ed-volume-fy05.pdf // http://www.mass.gov/chia/docs/r/ed/ed-volume-fy06.pdf // http://www.mass.gov/chia/docs/r/ed/ed-volume-2008.pdf // http://www.mass.gov/chia/docs/r/ed/ed-volume-2009.pdf
12. Pitts SR, Niska RW, Xu J, Burt CW. National Hospital Ambulatory Medical Care Survey: 2006 emergency department summary. National Health Statistics Reports. Aug 6 2008(7):1-38.
13. National Hospital Ambulatory Medical Care Survey: 2009 Emergency Department Summary Tables. National Center for Health Statistics.  http://www.cdc.gov/nchs/data/ahcd/nhamcs_emergency/2009_ed_web_tables.pdf
14. Long SK, Stockley K, Dahlen H. Massachusetts health reforms: uninsurance remains low, self-reported health status improves as state prepares to tackle costs. Health Affairs. Feb 2012;31(2):444-451.
15. Miller, S. The Effect of the Massachusetts Reform on Health Care Utilization. Inquiry. 2012 49:4, 317-326
16. Frakt A. Medicaid and access: Not what you think. The Incidental Economist. Dec 3, 2013. http://theincidentaleconomist.com/wordpress/medicaid-and-access/
17. MEDICAID: States Made Multiple Program Changes, and Beneficiaries Generally Reported Access Comparable to Private Insurance GAO-13-55, Nov 15, 2012. http://www.gao.gov/products/GAO-13-55
18. Irvin CB, Fox JM, Pothoven K. Financial impact on emergency physicians for nonreimbursed care for the uninsured. Ann Emerg Med. 2003 Oct;42(4):571-6.