By Katherine Baicker, Ph.D., and Amy Finkelstein, Ph.D.
The New England Journal of Medicine, July 20, 2011
Working with a team of researchers, we have taken advantage of an unprecedented opportunity to gauge the effects of Medicaid coverage on low-income, previously uninsured adults, using the gold standard of medical and scientific research: a randomized, controlled trial. In 2008, Oregon used a lottery to allocate a limited number of Medicaid spots for low-income adults (19 to 64 years of age) to people on a waiting list for Medicaid. Those selected by random lottery draw won the opportunity to apply for Medicaid. In total, about 30,000 people were selected from the 90,000 on the waiting list. Approximately 10,000 of those selected ended up being enrolled in Medicaid; not everyone who was selected successfully filled out the required application and met the eligibility criteria.
The lottery provides an opportunity to estimate the causal effects of being allowed to apply for Medicaid (intention to treat). It also allows us to estimate the causal effects of being enrolled in Medicaid relative to being uninsured (the effects of “treatment on the treated,” which we focus on below), under the assumption that selection by the lottery to be able to apply for Medicaid affects the outcomes we studied only through its role in increasing insurance coverage.
We now have evidence of the effects of the first year of Medicaid coverage after the lottery. These results are based on administrative data from hospital discharges, credit reports, and death records, in addition to mail surveys we conducted. We found that Medicaid coverage increases the use of health care.
Responses by Johnathon Ross and Don McCanne, former presidents of Physicians for a National Health Program:
Johnathon Ross MD, MPH
Toledo Ohio, USA
August 25, 2011
This is interesting “experiment” and useful policy data but it reminds me of Tuskegee. What a sad commentary on our country that we question whether access to care is good for patients and that it might cost us something to provide it. We need a national health insurance program that is nondiscriminatory, fairly financed, effective, and efficient. An improved and expanded Medicare for all would be the easiest to implement since the administrative savings would be adequate to cover all the uninsured and improve coverage and financial security for everyone. Instead we will muddle along with the half baked reforms that have been passed and continue to waste hundreds of billions of dollars on the billing and insurance bureaucracy. Cost control will be the natural outcome of setting a national budget for health care. This will lead to better emphasis on those services which are most beneficial and reduce future costs and disability. ACO’s, bundled payments, managed care will never accomplish what a budget will. What are we doing? Caring citizens should protect and empower each other.
and…
Don McCanne MD
San Juan Capistrano California, USA
August 25, 2011
With our current level of knowledge about the favorable impact of insurance coverage, obviously it would have been unethical to design a study in which the control group – the uninsured – was exposed to both the financial hardship and impaired health outcomes of being uninsured. It is ironic that this would represent an intolerable violation in ethics within the health policy community, yet at the same time represents an acceptable standard for politicians.
The Affordable Care Act, as a political document, includes policies that seem to violate fundamental health policy ethics. It was enacted knowing that tens of millions will remain uninsured, under-insurance will become the new standard (60 to 70 percent actuarial values), and that it is the most expensive model of reform, providing little relief from the financial burden placed upon all of us.
Ethical policies and sterile politics could have been melded into a process that would have brought us truly universal coverage, with comprehensive benefits, financial security for everyone, and cost containment through the power of an efficient public monopsony. That, of course, would describe a single payer national health program – an improved and expanded Medicare for all.
Instead, the policy community compromised their ethics by cooperating with politicians who were catering to interests much more powerful than patients. But the greater ethical transgression was committed by the politicians themselves who ruled out in advance of the reform process the single payer model. They knew that if it were seriously considered, the superiority would have been obvious when compared to the fragmented, dysfunctional, inequitable, administratively overburdened, overpriced system that the politicians dumped on us.
We can still go back to the drawing boards and do it right.