Ge­o­graphic dis­par­ity

Ex­clud­ing some of the poor­est from health re­form shouldn’t be an op­tion

Modern Healthcare - - OPINIONS / COMMENTARY -

One of the most dis­turb­ing chal­lenges faced by Amer­i­can health­care is the enor­mous ge­o­graphic vari­abil­ity in both ac­cess and qual­ity. We are one na­tion, and no mat­ter which state we live in, we are all Amer­i­cans. But (to para­phrase Bono) where we live ac­tu­ally de­ter­mines if we live.

A poor per­son liv­ing in Mas­sachusetts is more likely to have ac­cess to health in­sur­ance and health­care than one who lives in Texas. Given what we know about the re­la­tion­ship of health­care and health, this means that a poor res­i­dent of Texas faces the pos­si­bil­ity of a less healthy, shorter life.

This ge­o­graphic dis­par­ity is par­tially the re­sult of the his­toric state-to-state cov­er­age variation of low-in­come adults through Med­i­caid, the health in­sur­ance pro­gram for the poor. Un­like Medi­care, which is fed­er­ally ad­min­is­tered, Med­i­caid is jointly ad­min­is­tered and paid for by the fed­eral and state gov­ern­ments.

Al­though the fed­eral govern­ment picks up nearly 60% of pro­gram costs, states have a great deal of flex­i­bil­ity in set­ting el­i­gi­bil­ity stan­dards. There­fore, when they had the op­tion to do so, many states chose to ex­clude im­pov­er­ished adults, most of whom work.

The Pa­tient Pro­tec­tion and Af­ford­able Care Act would have ended this in­equitable Med­i­caid variation by es­tab­lish­ing a na­tion­ally uni­form floor for the na­tion’s poor­est chil­dren and non-el­derly adults. The fed­eral govern­ment would have paid 100% of the costs for three years.

But the U.S. Supreme Court’s 2012 de­ci­sion ef­fec­tively stripped out this floor by per­mit­ting states to opt out of the adult ex­pan­sion. Had the court ruled oth­er­wise, 2014 would have seen Med­i­caid ex­panded to ap­prox­i­mately 16 mil­lion poor Amer­i­cans with an un­prece­dented and gen­er­ous fed­eral con­tri­bu­tion.

Cur­rently, as many as half the states plan to say no, leav­ing some 10 mil­lion adults, in­clud­ing 284,000 im­pov­er­ished vet­er­ans who faith­fully served our na­tion, yet again with­out health in­sur­ance.

This dis­par­ity, based solely on where an Amer­i­can hap­pens to live, is un­ac­cept­able. The Obama ad­min­is­tra­tion may be able to move some of th­ese “no” states to “yes” by al­low­ing them to im­ple­ment the ex­pan­sion in non­tra­di­tional ways, such as by us­ing fed­eral

“When they had the op­tion to do so, many states chose to ex­clude im­pov­er­ished adults, most of whom work.”

Med­i­caid funds to buy cov­er­age through the new health in­sur­ance ex­changes es­tab­lished un­der the re­form law.

Some states are sure to still say no. In a ter­ri­ble twist of fate, ge­o­graphic dis­par­ity will be­come more, rather than less pro­nounced as a re­sult of the good in­ten­tions of the re­form law.

Should we al­low this ge­o­graphic dis­par­ity to con­tinue? As a physi­cian, who had the priv­i­lege of lead­ing one of the na­tion’s most ef­fec­tive health­care safety net sys­tems for 20 years, I think not. We need a so­lu­tion.

Let’s look more closely at the one variation on the model that HHS’ sec­re­tary seems poised to al­low. Un­der this ap­proach, states would be per­mit­ted to im­ple­ment the in­tended cov­er­age ex­pan­sion by en­rolling their poor­est res­i­dents, newly el­i­gi­ble for Med­i­caid un­der the re­form law, in pri­vate health plans sold in the ex­changes.

Some states on the fence ap­pear to be con­tem­plat­ing this ap­proach. How­ever, the Con­gres­sional Bud­get Of­fice es­ti­mates this ap­proach over time will cost 50% more per per­son per year. This is a sig­nif­i­cant draw­back. This cre­ates a fi­nan­cial and po­lit­i­cal dilemma for states, Congress and the Obama ad­min­is­tra­tion at a time when both po­lit­i­cal par­ties are con­cerned about the fed­eral deficit.

But if states can do this, why can’t the fed­eral govern­ment? Ev­ery “no” state will still have a fed­er­ally run ex­change. Why not per­mit HHS’ sec­re­tary to use this same ap­proach for the poor Amer­i­cans liv­ing in those states by of­fer­ing the same type of ex­change en­roll­ment di­rectly through the fed­eral ex­change into health plans us­ing fed­eral funds? Could it even be pos­si­ble to use the fed­eral ex­change to en­roll newly el­i­gi­ble in­di­vid­u­als in the “no” states into state Med­i­caid pro­grams?

Af­ter all, dur­ing the first three years, the fed­eral govern­ment will bear 100% of the Med­i­caid ex­pan­sion cost, and the re­form law al­lows the sec­re­tary to es­tab­lish an ex­change in any state that chooses not to do so. Di­rect Med­i­caid en­roll­ment would solve the in­creased cost is­sue of en­rolling in ex­change plans.

But it would have other bar­ri­ers, stem­ming from Med­i­caid be­ing op­er­a­tionally largely a state-man­aged pro­gram. Any al­ter­na­tive so­lu­tion will re­quire iden­ti­fi­ca­tion of long-term fi­nanc­ing to off­set the de­cline in fed­eral Med­i­caid fund­ing, which is set to be­gin by the fourth year of ex­pan­sion.

A the­o­ret­i­cal long-term so­lu­tion could be to have the fed­eral govern­ment per­ma­nently pick up all the costs of the Med­i­caid ex­pan­sion, whether they are in “yes” or “no” states. The to­tal cost (fed­eral plus state) would re­main the same, but the tax­ing body pay­ing for the ex­pan­sion would change, which could re­quire some fed­eral-state funds flow ad­just­ment. The state/fed­eral Med­i­caid re­la­tion­ship could also change.

As we all know, no so­lu­tion to the fund­ing of in­sur­ance cov­er­age is with­out com­plex­ity. But we need an al­ter­na­tive ap­proach to leav­ing mil­lions of des­ti­tute peo­ple out of health re­form. We can­not let it be said of this great na­tion, that “Where you live, de­ter­mines if you live.”

Dr. Pa­tri­cia Gabow is the for­mer CEO of the Den­ver Health and Hos­pi­tal Au­thor­ity.

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