Real Access to Quality Healthcare for the Poor

 

The beginning of a new year is a time for new optimism. A fresh year means the chance to accomplish things we failed to do in the last year. Improving healthcare access for all Americans, especially the poor, should be this year’s goal.

ObamaCare failed in most of its goals but it did increase the number of Americans who have health insurance. Unfortunately, most of those (about 70%) were enrolled in Medicaid. Medicaid was not created by the Affordable Care Act, but it was expanded in those states willing to make the Faustian bargain with the Obama administration. They were willing to accept the “free” expansion of their Medicaid rolls for three years in return for a permanent obligation long term that would greatly increase their state budgets.

Some might argue this was worth it since more of their state residents now have health insurance. But health insurance is only valuable if it provides access to quality healthcare.

Access and Quality

Medicaid does not provide access to quality healthcare. It does not provide access because few doctors will accept Medicaid patients due to low reimbursements. Even those who do accept Medicaid usually have limits on the number they will agree to see on a given day. Therefore Medicaid patients have a hard time getting appointments with a doctor. As a result, studies show Medicaid patients use emergency rooms 40% more than other patients, even the uninsured, for their primary care.

Medicaid does not provide quality healthcare for those who use it. The Oregon Health Insurance Experiment compared those on Medicaid to the uninsured and found the Medicaid patients had poorer outcomes than even the uninsured when measuring blood pressure, blood sugar, and cholesterol. Medicaid increased the chances of being diagnosed with diabetes but did not influence the treatment of the disease.

Improving Access to Quality Healthcare

Expanding the rolls of Medicaid has not improved the healthcare of poor Americans. A better way is needed. The solution is making it possible for those on Medicaid to purchase private healthcare insurance.

The Republican plans to replace ObamaCare may do just that. HHS Secretary nominee and Congressman Tom Price had put forth a bill called the Empowering Patients First Act (HR – 2300) that makes this possible. Under this program every American will be given a refundable tax credit that will allow them to “opt out” of Medicaid and instead purchase private health insurance.

A tax credit allows you to reduce your tax obligation dollar for dollar. If the tax credit is $2000 and your tax payment is $4000, then you now owe only $2000. A refundable tax credit means that if your tax credit is $2000 and you owe nothing, then you get to keep the $2000 and apply it to purchasing health insurance. It is equivalent to a voucher for health insurance.

Using the refundable tax credit, and possibly a supplement from the state, poor individuals will be able to purchase private health insurance that will enable them to see private doctors like most other Americans. This will improve their access and their quality of healthcare received.

Wouldn’t this cost a lot more taxpayers’ money?

Merrill Matthews, writing in Forbes, says the cost to the government, federal and state, should be no more than is currently being spent on the Medicaid program per person. This is very similar to the currently popular Medicare Advantage program used by millions of seniors. If the cost of the insurance is less than the tax credit and state low-income subsidy, the patient should be able to deposit the money in a Health Savings Account (HSA).

Plans would have to be approved by each state but the competition in the private health insurance market should keep the costs low, just as it does in the Medicare Advantage program. Furthermore, nothing in this proposal hinders block-granting Medicaid to the states or state efforts to reform the program, including a work requirement for enrollment. Such programs currently exist and have been highly successful in Indiana, where Vice-President -elect Mike Pence currently presides as governor.

Similar proposals are also in the current healthcare replacement plans proposed by House Speaker Paul Ryan and the Sessions-Cassidy bill I have written on in recent posts (see archives). This should be the year that we finally improve the access and quality of healthcare for poor Americans.

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