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Life Health > Long-Term Care Planning

On the Third Hand: Paying to get poorly paid

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The U.S. Government Accountability Office (GAO) recently put out a remarkable report on how state governments fund their share of the Medicaid tab.

In 2012, the most recent year for which numbers were available, states were getting about 40 percent of “the states’ share” of Medicaid costs by taxing physicians, hospitals and other health care providers.

In other words: Medicaid programs pay doctors and hospitals poorly to provide care for Medicaid plan enrollees, and then get much of the little money Medicaid providers get…from health care providers.

In other words: When the states get money to pay for Medicaid, they are a little like robbers who charge homeowners for the crowbars needed to break into the homeowners’ homes.

And yet we’re supposed to be celebrating because the Patient Protection and Affordable Care Act (PPACA) Medicaid expansion has sharply reduced the percentage of people who have no coverage whatsoever.

On the one hand: Personally, I want someone, somewhere, to pay for decent health care for everybody. I respect libertarians’ argument that government involvement reduces the efficiency of the health care and health finance systems for almost everybody, even poor people and sick people.

But, on the other hand, before we enter state of free-market bliss, we have to do something for the people who are sick today.

On the third hand: Pretending that we’re providing real health coverage that can pay for real health care, if we’re not really doing that, is not good for anyone, other than for people who write happy reports about the uninsured rate falling.

See also: PPACA plan liquidation petition highlights

For a year or two, insurers can burn off capital and surplus they built up during the 2000s to subsidize baby lizard plans, in the hope that the plans will grow up to be swans. But, eventually, at some point, insurers may have to look at lizard plans and acknowledge that they’re lizards, not swans.

Similarly, doctors may be able to find efficient ways to use e-mail, telemedicine, non-physician assistants and group appointments to multiply their capacity to deliver care, but, at some point, they’ll run out of their own hours in the day, and even the assistants’ hours in the way.

On the fourth hand: The big hospital companies still seem to be acting as if they’re better off getting patients with Medicaid than with patients who are completely uninsured. Maybe Medicaid pays providers somewhat better than we think.

But it could also be that big hospitals have an easier time than physicians at making a grim situation look better than it is. Physicians have to go into their clinics and confront waiting rooms full of bored, angry patients. Hospital company executives can go over their quarterly earnings in a nice conference center, miles away from patients.

If the enemies of PPACA win a victory on King vs. Burwell (Case Number 14-114), maybe they’ll succeed at killing off the entire PPACA exchange system, and giving many of the exchange plan enrollees an incentive to reduce or under-report their income enough to get into Medicaid, far from the eyes of agents and brokers, where Medicaid plan managers can pretend to pay for care, providers can pretend to provide care, and heaven help you if you’re a poor man who breaks a leg on a Sunday.


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