Medicaid is a mess

One of the big under-reported stories of ObamaCare is the huge number of people it has diverted into Medicaid.  A staple of virtually every ObamaCare story is the Administration’s attempt to confuse the two, mixing them together into one big pile of “enrollments.”

But Medicaid is not ObamaCare.  It’s not “health insurance” in the sense that the Affordable Care Act envisions; it’s a social welfare program that cost a lot of money, while returning very poor service, long before Barack Obama arrived in the White House.  ObamaCare is radically expanding Medicaid, but the program was not in any shape to handle such expansion.  Its problems are going to get worse under the increased burden.

Besides offering warm bodies to pad out those ObamaCare enrollment figures, Medicaid adds a dash of good old-fashioned socialist muscle to keeping ObamaCare alive, no matter how badly it fails.  You already hear a lot of muttered threats from pundits and government officials that repeal of ObamaCare is unthinkable, because it would leave all those new Medicaid recipients out in the cold.  It’s almost like a failsafe that was written into the law to protect it against public revulsion, by giving it an instant shake-and-bake legion of dependents.

The Medicaid expansion will also give FedGov more leverage over the states, because they’ve been roped into an agreement that has Washington paying the lion’s share of the cost for new benefits from these state-run programs.  The federal share of the expansion cost is 100 percent at first – which put some recalcitrant state governors on the wrong end of “Why are you saying no to free money?” howls from their constituents and political opponents – but the states will begin carrying some of the cost in the coming years.  They will live in fear that Washington doesn’t decide to alter the terms of the deal… something it can quietly threaten to do against governors who refuse to toe the federal line on a variety of issues, until fiscal reality forces our insolvent central government to regretfully ask the states to carry more of the burden.  Sorry about that, governors, really we are.  But the money just isn’t there.  We tried to get those evil rich SOBs to pay more in federal taxes, we really tried, but the rascally Republicans and their Tea Party masters shut down our tax-hike proposal, so we’re going to have to rewrite that Medicaid deal.

That day may come sooner rather than later, because as the New York Post puts it, “ObamaCare created a Medicaid time bomb.”  1.46 million of ObamaCare’s alleged 1.6 million “enrollees” actually enrolled in Medicaid, so the timer on that bomb is ticking fast:

The Congressional Budget Office projects that, in part because of ObamaCare, Medicaid spending will more than double over the next 10 years, topping $554 billion by 2023.

And that is just federal spending.

State governments pay another $160 billion for Medicaid today. For most states, Medicaid is the single-largest cost of government, crowding out education, transportation and everything else.

New York spent more than $15 billion on Medicaid last year, roughly 30% of all state expenditures. The Kaiser Foundation projects that over the next 10 years, New York taxpayers will shell out some $433 billion for the program.

But none of these projections foresaw that so many of ObamaCare’s enrollees would be Medicaid eligible.

To be sure, the health-care law’s designers saw the expansion of Medicaid as an important feature of their plan to expand coverage for the uninsured. Still, they expected most of those enrolling in ObamaCare to qualify for private (albeit subsidized) insurance.

It’s beginning to look like that was just another miscalculation, one that could have very serious consequences for the program’s costs.

The Post notes the Obama Administration has already made some ominous noises about rewriting the federal subsidy deal to put more of the burden on state governments… which, as noted above, are not well-equipped to handle it.  My hunch is that they’ll wait until Obama takes a shot at using the unanticipated costs to demand a big federal tax hike during his next “debt ceiling negotiation.”  If he doesn’t get it, I advise every governor who participated in the Medicaid expansion to find a nice, comfortable spot under his or her desk and hide there.

This ocean of Medicaid money is not exactly providing the top-quality high-tech health care Obama promised when Democrats were ramming the Affordable Care Act through Congress:

While Medicaid costs taxpayers a lot of money, it pays doctors very little. On average, Medicaid only reimburses doctors 72 cents out of each dollar of costs. ObamaCare does attempt to address this by temporarily increasing Medicaid reimbursements for primary-care doctors, but that increase expires at the end of next year.

Because of the low reimbursement, and the red tape that accompanies any government program, many doctors limit the number of Medicaid patients they serve, or even refuse to take Medicaid patients at all. An analysis published in Health Affairs found that only 69% of physicians accept Medicaid patients. A study published in the New England Journal of Medicine found that individuals posing as mothers of children with serious medical conditions were denied an appointment 66% of the time if they said that their child was on Medicaid (or the related CHIP), compared with 11% for private insurance — a ratio of 6 to 1.

Even when doctors do still treat Medicaid patients, they often have a harder time getting appointments and face longer wait times. One study found that among clinics that accepted both privately insured children and those enrolled in Medicaid, the average wait time for an appointment was 42 days for Medicaid compared to just 20 days for the privately insured. One study found that among clinics that accepted both privately insured children and those enrolled in Medicaid, the average wait time for an appointment was 42 days for Medicaid compared to just 20 days for the privately insured.

This leads many Medicaid “beneficiaries” to throw up their hands and head for the emergency room, which is… precisely the problem ObamaCare was allegedly created to solve.  The old “cost shifting” situation of hospitals eating emergency-room costs for the uninsured was never as big as it has been made out to be (frankly, studies cited during the Supreme Court hearings on ObamaCare showed it was smaller than I thought it was) but ObamaCare is worse.

The Post is mildly hopeful that the disastrous rollout of “skewed” Medicaid enrollments, implying that more people might opt to buy Affordable Care Act coverage if given a fair chance.  I’m rather dubious about that outcome, especially since the chaos in doctors’ offices next year isn’t going to make those expensive high-deductible policies look like a great practical improvement over “free” Medicaid.

But speaking of “skewed” Medicaid enrollments, USA Today has a story about incorrectly sending people who aren’t truly eligible into the program:

State and industry officials haven’t quantified the problem yet, but the National Association of State Medicaid Directors may release information next week after following up on reports from around the country, says Executive Director Matt Salo.

Here’s what happens: When consumers applying for insurance put their income information into subsidy calculators on — the exchange handling insurance sales for 36 states — it tells them how much financial assistance they qualify for or that they are eligible for Medicaid. If it’s the latter, consumers aren’t able to obtain subsidies toward the insurance, although they could buy full-priced plans.

If the Medicaid determination is wrong, consumers should file an appeal with the federal marketplace, says Department of Health and Human Services spokeswoman Joanne Peters, but she says she does not have an estimate on how long that would take.

Brokers are reporting that some of their clients are in insurance limbo as they wait for the error to be corrected by HHS or their states so they can reapply.

My oh my, Limbo is getting pretty crowded these days.  The margin of error here is as darkly comical as the rest of ObamaCare’s failures:

Jessica Waltman, top lobbyist for the National Association of Health Underwriters, says she’s heard a number of reports from around the country of people making as much as $80,000 a year being told they qualify for Medicaid on

“I have heard on multiple occasions from brokers in various states over the past eight weeks that they have had wacky Medicaid determinations with people who clearly make way too much money for Medicaid,” she says.

What madness!  Everyone knows that people who make $80,000 a year should get taxpayer subsidies so they can buy insurance from government-controlled private vendors, not sign up for Medicaid!  Gee, I sure hope there aren’t unscrupulous people out there deliberately trying to game a system that tries to put people who make $40 an hour on welfare.

A few weeks ago in the Wall Street Journal, writer Nicole Hopkins told the story of how her mother was forced into Medicaid by the Washington State exchange system, after Affordable Care Act mandates made her old insurance plan unaffordable:

The situation sounded absurd, so I asked her to walk me through her application on Washington Healthplanfinder to make sure she wasn’t missing anything. Sitting in New York with my computer, I logged onto the site under her name and entered the information my mother provided over the phone. I fully expected her to realize that she had forgotten some crucial piece of information, like a decimal point in her annual income. We checked and double-checked the information, but the only option still appeared to be Medicaid. She suggested clicking on “Apply for Coverage,” thinking that other options might appear.

Instead, almost mockingly, her “Eligibility Results” came back: “Congratulations, we received and reviewed your application and determined [you] will receive the health care coverage listed below: Washington Apple Health. You will receive a letter telling you which managed care plan you are enrolled with.” Washington Apple Health is the mawkish rebranding of Medicaid in Washington state.

The page lacked a cancel button or any way to opt out of Medicaid. It was done; she was enrolled, and there was nothing to do but click “Next” and then to sign out.

Ms. Hopkins’ mother, who prides herself on taking care of her own needs, was not pleased with her one-way nonstop ticket to dependency.  “How has it come to this?” she asked.  “How have I fallen this far?”  Hopkins says her mom knew she was eligible for Medicaid, but until now, she chose not to participate:

“I just don’t expect anything positive out of getting free health care,” she said. “I don’t see why other people should have to pay for my care, whether it be through taxes or otherwise.” In paying for health insurance herself—she won’t accept help from her family, either—she was safeguarding her dignity and independence and her sense of being a fully functioning member of society.

Before ObamaCare, Medicaid was one option. Not the option. Before this, she had never been, in effect, ordered to take a handout. Now she has been forced to join the government-reliant poor, though she would prefer to contribute her two mites. The authorities behind “affordable care” had erased her right to calculate what she was willing to spend to preserve her dignity—to determine what she thinks is affordable.

That little contribution can mean the difference between dignity and despair.

But that’s a choice the all-powerful, all-wise government makes for people now.  “Dignity” does not enter into their equations.  Doubtless the ObamaCare commissars would say Nicole Hopkins’ mother was foolish for not taking advantage of the wondrous government goodies the taxpayers were thoughtfully forced to provide.

Forbes warns that Medicaid reimbursement cuts will contribute to the “doctor shock” that is rapidly becoming the next big ObamaCare shoe to drop.  some 9,500 doctors stopped accepting Medicaid patients in 2012, before the full fury of ObamaCare was even unleashed.  Americans are learning that Obama didn’t just lie about keeping your plan if you liked it.  He was lying about keeping your doctor, too.  And if you think the situation in doctor’s offices is already going to be chaotic because of the error rate in data – which hovers somewhere between 10 and 25 percent, based on varying estimates – just wait until the tottering Medicaid bureaucracy is expected to deal with a blizzard of bad data.  If the private sector is having trouble with it, vastly less efficient Big Government is going to go nuts.