Medicaid Expansion: Good News And Bad News

Will Obamacare’s Medicaid expansion make it more difficult for Medicaid beneficiaries to find care?  It’s already well known that finding a physician who takes Medicaid is difficult.  Some critics of Obamacare have suggested that by expanding Medicaid enrollment without also expanding the supply of providers to treat the new enrollees will result in a shortage of health care for Medicaid beneficiaries.

ObamayesandnoWell, some recent research in JAMA Internal Medicine suggests that might not happen.  This article looked at Medicaid expansions prior to Obamacare and found little difference in access for Medicaid beneficiaries in states that expanded Medicaid versus states that did not.   In short, Medicaid enrollees may have trouble accessing care, but it doesn’t appear that those difficulties get any worse with an expansion.

That’s the good news.  On the other hand, some of these expansions were limited to a few states and some were relatively small expansions.  That is, they were not on the magnitude of the Obamacare expansion.  Will the greater magnitude of this expansion create access problems?  We’ll, have to wait and see on that.

The bad news comes from an article in the International Journal of Health Care Finance and Economics.  It examined the the effect that Medicare prices had on Medicaid prices, and while it found that while Medicare prices affect Medicaid prices for physicians, they didn’t find any impact on hospital prices.  The article states:

This suggests that the Medicaid program does not compete with Medicare by adjusting reimbursement prices for patient access to basic hospital care.  In this case, lack of competition is consistent with providers having enough capacity to serve all Medicare and Medicaid patients at relatively lower market prices.

The take away from that is Medicaid is likely to remain a program where enrollees are likely to get a lot of their care in an emergency room, and not from physicians, even under the expansion.

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