An exclusive to Doctor Pundit, by Laura Katz Olson, PhD

Medicaid, a core component of the recently enacted Patient Protection and Affordable Care Act, will now cover all low-income individuals, regardless of age or family status, with incomes up to 133 percent of the Federal Poverty Level. However, I would argue that Medicaid is not the best way to advance universal insurance coverage. The program is firmly anchored in the states, whose glaring inability to lead the way is most evident in their fiscal constraints: during difficult financial times, such as now, unemployment, the number of uninsured households and Medicaid caseloads all rise, just when the states confront declines in their revenues. For example, average enrollments in 2009 increased by 5.4% and spending by 7.9% but revenues were down by 7.5%. Consequently, many localities have eliminated or reduced certain benefits (including dental care, hearing aids, glasses, rehabilitation services) and decreased provider fees (leading to less access to doctors, especially specialists). Even in “better” times, Medicaid is a source of continuing financial strain.

Medicaid’s state-by-state approach to insuring the poor also has produced an inequitable, haphazard distribution of health care. Different jurisdictions vary widely in such factors as immigrant status, the number of older people, size of their rural population, availability of physicians and facilities, financial resources and the political will to pay for uninsured households—all factors affecting the unevenness in Medicaid practices. The type and level of services individuals obtain depend on their geographic location or on which party or governor is in power at any particular moment.

Thus, building on Medicaid—adding roughly 16 million low-income people to its rolls—will only intensify current problems and inequities. Newly insured people will still face the same second-class medical care, access impediments, and other wide-ranging failings of the current Medicaid program. Complicating the issue, even as the states are initiating the complex and costly implementation process, twenty one places are suing the federal government over the expansion mandate.

At the same time, elected national officials (including many Democrats) want to rein in deficit spending, as illustrated by the recent elimination (by the House of Representatives) of the $24 billion stimulus extension bill that at least 30 states were counting on to sustain their already reduced 2011 Medicaid plans. If the Senate does not restore it, we are likely to see even leaner benefit packages. The national and state governments have always had a contentious relationship over Medicaid funding, now exacerbated by the recent legislation. The newest layers of bureaucratic red tape set additional hurdles for the states to sort out.

Just as problematic, in order to enact health care reform, President Obama and congressional leaders had to placate key provider groups, making deals with them that precluded any genuine cost controls. Thus, insurance premiums will continue to rise, drug companies will charge their usual exorbitant fees and other suppliers of services will cash in, rendering overall costs far greater than projected. We may get far greater health insurance coverage, a laudable achievement, but will we be getting our money’s worth?

About the Author:

[Laura Katz Olson is professor of Political Science (Lehigh University) and author of The Politics Of Medicaid (Columbia University Press, 2010). She has written numerous books on the politics of healthcare policy and healthcare delivery of the aging population. She has lectured extensively on issues related to women's studies, Social Security, Medicare, and long-term care policy. Her other published works are: The Political Economy of Aging: The State, Private Power, and Social Welfare; Aging and Public Policy: The Politics of Growing Old in America; Age Through Ethnic Lenses: Caring for the Elderly in a Multicultural Society; and The Not So Golden Years: Caregiving, the Frail Elderly, and the Long-Term Care Establishment.]

Related Posts Within Doctor Pundit:

1. Study: Rapid Growth in Healthcare Expense Due to Medicaid Unlikely to Moderate President Obama’s recent remarks surrounding the commitment to Americans the...
2. Study Commissioned by Texas Legislature Confirms Dire Medicaid Financing Scenarios State government’s intentions to possibly opt out of Medicaid is...
3. HHS Gets Specific on States’ Needs in Face of Possible Cuts to Medicaid The Obama administration’s push to help cash strapped states weather...
4. GOP Leaks Preliminary Details on Medicaid Reform Plans A (very concise) Medicaid primer: states, in a partnership with...
5. Study: Medicaid Coverage ‘Substantially’ Improves Access to Care How does obtaining health coverage (insurance) compare to not getting...