Note from Pete Simpson: Medicaid expansion remains one of the most politically-charged issues in Wyoming in recent years. While opposing sides seem so far apart you could drop Wyoming through the gap, Medicaid expansion has also coalesced in favor of expansion a large group of stakeholders who rarely agree on political issues. And the issue remains unresolved.
We need more discussion, and more facts behind the discussion. So this week we’re asking readers to dive back into the Medicaid issues with two Wyoming people who are not politicians but are what I might call policy wonks: Charles Katebi of the Wyoming Liberty Group and Sarah Gorin, formerly of the Equality State Policy Center, and most recently director of the low-income healthcare clinic in Laramie. Both make impassioned arguments, and both cite detailed studies to support their positions.
We hope readers can use these columns to start to learn about the issues in detail for themselves — getting beyond the short sound bites that occupies most of the political debates on this issue. Read these columns, check out the studies they cite, and come back to us with your comments. Make sure those candidates out there have studied up on it too! — PS
— by Charles Katebi
There’s no question that Wyoming needs reforms that make healthcare more affordable, accessible, and responsive to the needs of patients. Expanding Medicaid under Obamacare is not one of them. Instead, the program crowds out private insurance, underpays doctors, and delivers terrible outcomes to patients.
For starters, Medicaid expansion would take away healthcare options poor patients already have. Nearly 6,000 low income Wyomingites who would be eligible for Medicaid expansion are already covered by private insurance through the federal Obamacare exchange. As part of Obamacare coverage, they receive ample federal subsidies that cover their premiums and out-of-pocket expenses.
But if Wyoming expands Medicaid, these individuals will lose their private insurance. Under Obamacare, individuals who are eligible for Medicaid are ineligible for subsidized private insurance. Expanding Medicaid to this population would take away their subsidies, make their insurance unaffordable, and force them off their health plans.
Indeed, the vast majority of Medicaid’s potential new enrollees already have private insurance. Using data from the federal Medical Expenditure Panel Survey on nationwide figures, academic researchers at the U.S. Department of Veterans Affairs concluded:
“… The [Obamacare] Medicaid eligibility expansion will have relatively small effects on the number of uninsured, with about four fifths [emphasis added] of the public expansion crowding out private coverage.”
Instead of expanding healthcare access, Obamacare’s Medicaid expansion would strip private healthcare options away from thousands of poor Wyomingites and place them on an overburdened government system.
But it gets worse. By driving Wyomingites who are already insured onto the Medicaid rolls, the state puts vulnerable patients at risk. According to the Wyoming Department of Health, Medicaid expansion would cost Wyoming $11 million over the next two years. But because of falling mineral revenues, that’s $11 million we don’t have. As the director of Wyoming’s Department of Health, Tom Forslund, recently explained to the Joint Appropriations Committee; “That ship has sailed… The money that I would have moved over to pay for [Medicaid expansion] is gone.”
The only way Wyoming could come up with that money is by diverting resources from existing state health programs. These programs primarily serve low-income children, the elderly, and disabled. Expanding Medicaid would strip funding from programs for truly needy patients in order to provide healthcare for able-bodied and childless adults, most of whom already have private insurance.
Expansion supporters also peddle the myth that as more low-income patients enroll in Medicaid, hospitals and doctors will enjoy better compensation.
This is false. Contrary to these claims, Medicaid chronically underpays doctors and is a major drag on hospital finances. According to the Department of Health, Medicaid only pays hospitals 84 cents for every dollar of care they render to patients. Every year, Wyoming hospitals lose $14 million because of Medicaid’s underpayments. This means less money to pay doctors who treat our poorest patients, and less money for hospitals that invest in new technologies that save lives.
But hold on, it gets even worse. Medicaid is about to make it even harder for doctors to treat vulnerable patients. In response to Wyoming’s dramatic fall in mineral revenue, Governor Matt Mead made sweeping cuts to Medicaid’s payments to doctors and hospitals. Mead first cut reimbursements across-the-board to all providers by 3.3 percent. He further slashed reimbursements through targeted payment cuts on a variety of medical providers, including nursing homes, pharmacies, and mental health clinics. Over the next two years, Wyoming’s healthcare providers will see Medicaid compensation fall by $77 million.
A report from the Centers for Disease Control finds that the less Medicaid pays, the less doctors are willing to treat the program’s patients. In states where Medicaid pays the least, like New Jersey and California, as many as 60 percent of practicing physicians no longer accept Medicaid patients. Mead’s cuts will similarly make it harder for Wyoming’s doctors to treat patients already on Medicaid. And they certainty won’t be able to take on more patients through Medicaid expansion. This is a potentially dangerous problem for a rural state like Wyoming, given the state’s shortage of doctors.
We also know Medicaid patients suffer from a variety of debilitating health conditions as the program drives doctors away. After surveying cancer patients, doctors at the University of South Florida found that Medicaid patients were 31 percent more likely to have late-stage breast cancer and 81 percent more likely to have late-stage melanoma than patients without any insurance at all. Other studies also find Medicaid patients fare worse than the uninsured when it comes to colon cancer, prostate cancer, vascular disease, and many more ailments. Does it make any sense to expand a healthcare program that delivers poorer outcomes than if its enrollees had no insurance at all?
Wyoming needs new and innovative ways to make healthcare less expensive and more accessible for everyone, especially the poor. Unfortunately, Obamacare’s Medicaid expansion traps patients in inferior care, discourages doctors from treating them, and diverts resources away from treating the most vulnerable. Medicaid expansion is medicine that will only make Wyoming sicker.
— Charles Katebi is a healthcare policy analyst at the Wyoming Liberty Group. His research interests include the health impacts of government policy and the benefits of patient-centered healthcare. He received a B.A. in economics from the University of British Columbia. He lives in Cheyenne.
— Columns are the signed perspective of the author, and do not necessarily reflect the views of WyoFile’s staff, board of directors or its supporters. WyoFile welcomes guest columns and op-ed pieces from all points of view. If you’d like to write a guest column for WyoFile, please contact editor@wyofile.com.
Mr. Katebi disses the Affordable Care Act a number of ways beginning with the name “Obamacare”. It is not a perfect solution, but what is saddest of all is that it has been the law of the land for six years and we have a physician and an accountant serving as our senators during that entire time and not once have I heard of an effort by either of them to amend it to make it a better solution for everyone. All any of them have done is excoriate it at every turn and not attempt a bipartisan solution. That’s called governance.
As to solutions for improving the costs and reimbursements for healthcare, I have yet to hear any concrete proposals from Congress, our state legislature or for that matter, your own think tank. All we hear are platitudes and no attempt at solutions–for everyone not just the people that can already afford insurance.
As to the “self reporting” of uncompensated care by hospitals, at least some of them have to file those numbers in a 990 that is completely transparent to the public–apparently unlike your group’s returns. It is a bit disingenuous of you to suggest that a cartel of Wyoming hospitals are conspiring to overstate what is becoming an increasingly onerous problem in healthcare.
Bill, calling the President’s healthcare law by its legislative title a little disingenuous, considering that it’s raised the cost of insurance astronomically.
Obamacare is worse than “not a perfect solution.” “Not a perfect solution” would be reforms that start to reduce the cost of health care and coverage. Obamacare takes the worst incentives that existed in our healthcare system, and supercharges them. That’s why the cost of care continues to increase and doctors continue to leave their profession in droves.
And as the chairman of the Republican Platform Committee, Senator John Barrasso has been actively involved in proposing changes to Obamacare and our healthcare system. You can read them in the section of the 2016 Republicans Party Platform titled: Restoring Patient Control and Preserving Quality in Healthcare. He’s also introduced legislation with Senator Mike Enzi that would amend the employer mandate so it doesn’t price as many part time workers out of a job. The title of that bill is: Small Business Fairness in Health Care Act.
Other Republicans in Congress have proposed many reforms to Obamacare and healthcare in general. I would recommend you read into the most recent proposal made by the Speaker of the House Paul Ryan, titled “A Better Way.” You can read about it here: http://abetterway.speaker.gov/_assets/pdf/ABetterWay-HealthCare-PolicyPaper.pdf
How do you know uncompensated care is becoming an “increasingly onerous problem” ? Hospitals report their numbers through IRS 990 forms that are open to the public. But we have no idea whether those numbers are trust worthy. Hospital uncompensated care numbers are completed self-reported. A Department of Health report that looked at those numbers even said:
“Cost report data are self-reported by hospitals or the contractors they hire. Reports are rarely audited, and quality is therefore uneven.”
Before we decide to throw taxpayer money at large hospitals, maybe we should audit them and see if those uncompensated care numbers are really as large as they claim. If uncompensated care is really as large a problem as they claim, hospitals should welcome audits that take a closer look at their finances.
Mr. Katabi is cherry picking his data. The concluding sentence from the same report Mr. Katabi cites reads, “When the Medicaid,tax, exchange, and mandate provisions of PPACA are all considered over 20 years, the uninsured will be absorbed mostly by public insurance with substantial help from subsidized coverage through exchanges, and private insurance will remain about the same.” In reading through the study, he would have seen that the study includes more than just Medicaid in the public insurance calculations.
In arguing against the Medicaid Expansion, Mr. Katabi forgets to mention that there are an estimated 20,000 Wyomingites with absolutely no coverage of any kind that would be covered by Medicaid Expansion.
Finally, Mr. Katabi proposes that being paid $.84 is somehow worse than being paid $.00. Wyoming Hospitals and health care providers don’t agree with him.
Laurie, I wasn’t aware that the purpose of Medicaid expansion is to bailout large hospitals with taxes paid by working and middle-class Wyomingites. Hospital data on uncompensated care is entirely self-reported, meaning we have no verifiable data that shows they’re hurting from paying for uncompensated care. As a candidate, do you think residents of House District 59 should bailout hospitals that won’t even open up their books?
On whether I am “cherry-picking” my data: the study is very clear on Medicaid’s crowd out effect, saying: “We find high rates of crowd-out for Medicaid expansions aimed at working adults (82%), suggesting that the Medicaid expansion provisions of PPACA will shift workers and their families from private to public insurance without reducing the number of uninsured very much.”
Maybe we should provide targeted support to the uninsured instead of growing a bloated government program that can’t even afford to take care of patients that already rely on it.
Wyoming regulates insurance forms and solvency. That’s it. We have nothing to say about rates or coverage.
As you may recall, the ACA established essential health benefits and also required disclosure about coverage, networks, cost-sharing, etc. Before then, any piece of worthless snake oil could be sold as insurance in Wyoming. My friend’s elderly mother bought the John Wayne Cancer Insurance plan (or something like that). Can you guess how many benefits she received when she got cancer? None. You would blame her for signing up for a worthless policy. I like regulations that make it easier for consumers to know what is worthless.
No, the ACA completely changed what could be called a qualified health plan,with assurances about access and coverage and full disclosure about provider networks and drug plans and copays. With the ACA, “insurance” means something.
Once again, detractors demonstrate ignorance or willingness to misrepresent the facts.
You don’t sound very familiar with Wyoming’s pre-Obamacare insurance marketplace. Prior to Obamacare, Wyoming mandated insurers cover 37 different benefits: including Mammograms, Cervical Cancer Screenings, Colorectal Cancer Screenings, Breast Reconstruction, and others. You can learn more about Wyoming’s pre-Obamacare insurance mandates here: http://www.bcbs.com/healthcare-news/press-center/15-731-W40-2015-Annual-Report-Final.pdf
I also like disclosures that make it easier for patients to know their benefits. But Obamacare isn’t
about educating patients to be informed and empowered consumers. Obamacare imposes a one-size-fits-all mandate on all health plans that take choices away from patients. Patients should have access to both comprehensive insurance as well as narrow catastrophic coverage. It should be up to patients to decide, not an unaccountable federal agency.
Unfortunately, Obamacare mandates expensive insurance on everyone, which is why healthy and younger people aren’t enrolling. If you don’t incentivize healthy individuals to get covered, you’ll bankrupt insurance companies. This is why you’re seeing insurers in Wyoming and across the country leaving the individual market.
Obamacare’s “assurances about access” are meaningless if you drive patients’ insurers into bankruptcy .
As a self-employed couple with a family, for many years we negotiated the insurance offered by private industry. We signed up at a stated rate, but over time those rates increased steadily. It was almost impossible to understand the numerous exemptions to coverage, but we knew that if something catastrophic happened it would have bankrupted us. It was insurance that wasn’t really insurance. The vast majority of bankruptcies in the U.S. before passage of the National Health Care Act occurred because of medical issues. Fortunately, everyone in our family stayed healthy and as soon as our rates became unmanageable we switched to a new company. If one of us had been sick, no other company would have covered us and we would have been held hostage to the insurance company and it’s exemptions, qualifications and every increasing premiums. At the same time the CEO of that insurance company would have been bringing home a multi-million dollar salary. Thank you President Obama for the ACA. Now could we please stop arguing about it and fix the problems it does have.
This piece is flawed because it argues from a mistaken presumption that there are affordable health insurance options available for those roughly 20,000 Wyomingites that fall into the coverage gap. There is a reason why they are not covered, Mr. Katebi, and it isn’t because they haven’t done their research. The Affordable Care Act built in a coverage option for those that fell into the gap and that was Medicaid expansion.
Your extended, agenda-based piece failed to mention that Medicaid expansion is a crucial part of the Affordable Care Act. You also fail to mention the benefits that states like Kentucky, Colorado, and others have experience through expanding Medicaid. These benefits include expanded services, budget savings, added healthcare jobs, among other benefits.
Finally I do not see your logic in arguing against the Affordable Care Act and the high price of insurance premiums, while at the same time contending that there are health insurance options for everyone if they look for it. This is a biased piece from an exceedingly biased organization.
Come on Charlie, everyone has liberty, just not in your market. I guess the country you should talk to is Australia. They have a national plan called a flat tax. Every person pays in and no it is not socialist medicine, it is national medicine. Here is an example your insurance boys don’t like as an example. I’m in Saratoga walking from house to house. Needless to say I met a man from that country. He said to me as we were talking this statement. I cannot understand why America with all its great medical opportunities, treats it’s citizens as a third world citizen. I had a heart attack in Sidney and hit the street. I was taken to hospital and given a triple bypass, what do think the cost was to me? I replied at least $90,000 in total cost. He replied no mate: I had to pay $5.83 in America currency for my phone bill.. In June of this year again, I had the opportunity to talk to an Australia family. I ask do you have any kind of insurance, the father replied, no mate those blokes have been trying for years to enter our country, us blokes won’t let them in, maybe we should look at that a flat tax we all pay, including you Charlie…
The “Wyoming Liberty Group” is a shadowy “stink tank” which claims to be “educational” but in fact lobbies for specific political causes. It refuses to reveal its entire IRS Form 990 in an attempt to conceal who funds it; however, as documented at
http://www.wyomingnews.com/opinion/rich-outsiders-are-behind-wyoming-liberty-group/article_7740d5a2-1580-586e-8ac7-3766eea77c97.html
it is funded by rich entities from outside Wyoming, such as the infamous Koch brothers. The Kochs are known for opposing all public “safety nets,” no matter how beneficial they might be to a state such as Wyoming, which would benefit greatly from the funding. No wonder it spews disinformation about the benefits of Medicaid expansion! Best take this piece with a mountain of salt.
Charlie you sound like a lobbyist for insurance companies. Who really stands to lose if insurance premiums are depleted and affordable insurance is granted to the in between people? Cover you mention for a 30 year male at 15 dollars a month and 150 dollars deductible sounds great, however publish the policy for coverage and the total amount of coverage offer on the policy. Have you ever gone without medical coverage and what is your current coverage. Is such coverage offered through a private sector employer or a governmental branch. Put your coverage out maybe we’d like to look at that 35 year old male policy.
Patients stand to lose if Medicaid expansion kicks them off their insurance and forces them onto the program. Uninsured patients would be far better off if we made it easier for them to enroll on private insurance.
If you’d like to know what the BCBS policy offers for a 35 year old male in Carbon County, here’s the link: http://wyomingbluesbc.com/marketplace/BlueSelectSilverValueTwo94forIndividuals
Let’s get rid off ALL restrictions on the private insurance companies then premiums will be affordable for everyone with no subsidies. In a free market you can do whatever you want and all of the profits the insurance companies make will always trickle down to assist the poor.
There seems to be something major missing from Mr. Katebi’s analysis. One is how someone who is at the income level that make him or her eligible for Medicaid if it were expanded is able to afford insurance in the market exchange without a subsidy. I have a friend in her 20’s who is only able to work part-time, cannot afford health insurance and goes without treatment or even diagnosis of abdominal pains that perpetuates her not being able to work full time. I know in talking with others that almost everyone knows of someone in this “Medicaid” gap and suffers because of it.
Chesie, that’s one of the most tragic features of Obamacare. It creates a two-tiered healthcare system. It offers financial support to those above the poverty line to buy private health insurance, but not to those below it. The best Obamacare offers to the poorest patients is Medicaid, a program that forces patients to wait weeks and sometimes even months before they’re treated.
A far better system would giver your friend direct financial support to buy the best health plan to meet her needs. She would have the freedom to choose her deductible, her benefits, and her doctors. She could even use this financial support to buy her healthcare directly through a concierge or direct primary care practice.
Does this mean that the Wyoming Liberty Group now thinks that Obamacare is a program they can support?
I don’t support Obamacare. Obamacare has made insurance more expensive and less response to patients’ individual needs. Even worse, it taxes and fines individuals who can’t afford to pay for Obamacare’s premium increases.
There are however, pieces of Obamacare that are more harmful to patients than other pieces. It’s far more harmful for patients to be on Medicaid, than if we simply helped patients get covered by private insurance.
Private health plans offer better choices and greater healthcare access to patients, especially those with serious conditions. Medicaid on the other hand, drives doctors away, and makes it harder for patients to get the healthcare they need.
If we know private health insurance treats patients better than Medicaid, let’s make private health insurance more easily accessible to low-income individuals and families.
Of course you don’t. That was my point. As a Wyoming employer who has provided health care coverage for my qualified employees since 1978 I can tell you that it is very simple why there are so many workers in Wyoming without healthcare insurance. It is too expensive. So if your plan is to “simply help patients get covered by private insurance” where is the money to come from and what is your plan?
You’re right that many people are uninsured because health insurance is expensive. So the question is why health insurance is expensive and what we should do about it.
The primary reason why health insurance is expensive is because the majority of patients have little to no incentive to seek less expensive healthcare. Medicare, Medicaid, and employer-sponsored insurance pay for most if not all of their member’s health costs. Obamacare made this problem even worse by further disconnecting patients from their costs. And hospitals are more than happy to accommodate patients’ indifference to cost by raising their fees and making their billing impossible to understand. The uninsured suffer the most, because when they get sick, they have to confront this over-priced and convoluted healthcare system.
If we want to make patients cost-conscious consumers, Medicaid, Medicare and employer-sponsored plans should move from defined benefit to defined contributions, and give their enrollees a flat subsidy they could spend on their own healthcare. It would be their money, meaning they would have an interest in finding the best value for their dollars.
Where would the money come from, specifically regarding Medicaid? These change could come from block-granting Medicaid, a proposal that US Speaker of the House of Representatives Paul Ryan and Presidential nominee Donald Trump support. Or Wyoming could seek a Medicaid waiver, which would provide Medicaid patients a financial stipend to buy private health insurance.
There are many other potential solutions to make health coverage and care more affordable. We could also expand Health Savings Accounts, and let employees control their healthcare dollars, rather than let their employer decide.
Mr. Katebi makes a strange argument when he says that the expansion would take away health care options. If you take my son and his family as an example, you see that the options they might have all depend on money which they don’t have. Sure, Medicaid limits what the insured can do but when compared to being able to do nothing because you can’t afford it you quickly see that Medicaid expands what individuals can do. From a cold theoretical viewpoint, Mr. Katebi is right but once he descends from the ivory tower of ideology that all vanishes like a mirage. Maybe the Liberty Group should send folks out to interview the working poor in Wyoming?
Pinedale, Wyoming
Many low-income Wyomingites have affordable healthcare options. Obamacare offers low-income individuals and families private health insurance with heavily discounted premiums and deductibles. A 30 year old male on the poverty line in Sublette County can buy a silver Blue Cross Blue Shield insurance plan on helathcare.gov for only $15 per month in premiums and $150 for their deductible.
Why should we strip the least fortunate of private health insurance that offers greater access to doctors and treatments, and replace it with Medicaid, a government program with fewer choices and options?
When I checked out Healthcare.gov I couldn’t find a deductable that low. For my family of 4 the premium was 1800 per month with a deductable of $3500. Now how is that affordable.
You can find Obamacare’s enrollment numbers by income levels here: https://aspe.hhs.gov/health-insurance-marketplaces-2016-open-enrollment-period-final-enrollment-report
Mr. Katebi do you have a source for this statement? “Nearly 6,000 low income Wyomingites who would be eligible for Medicaid expansion are already covered by private insurance through the federal Obamacare exchange.” I would like to check it out? Thank you.
No, Mr. Katebi said the “vast majority” of people eligible for expanded Medicaid already have insurance. I believe that would have to at least 10,000 but probably much more. You can’t use any survey information that predates implementation of Qualified Healthcare Plans, when insurance actually got coverage standards.
Another major flaw with this piece is complete disregard for the latest information on sustainable income in Wyoming (see Sarah Gorin’s companion piece). If you are at the poverty level, you are making about $12,000 a year. Even at 138 percent of poverty ($16,000 a year), you are not even covering housing, food and a way to get to work. A $150 deductible means you don’t get healthcare. Not affordable.
Many other flaws, which may be addressed later.
Marguerite, health insurers had coverage standards long before Obamacare became law in 2010. Wyoming’s Department of Insurance has existed since 1919, regulating Wyoming’s health insurers. They regulate insurers’ finances, benefits, and other terms and conditions.
Obamacare is partly based on the paternalistic idea that voters shouldn’t have the freedom to decide how their state’s insurance markets should be regulated. Sadly, some still believe that Wyoming’s voters can’t be trusted to regulate their own lives, and that unaccountable federal agencies should regulate our health insurance.