Medicaid has mixed record on improving health for poor, study says

By Noam N. Levey

4:00 p.m. CDT, May 1, 2013

 WASHINGTON — As state leaders debate whether to expand their Medicaid programs next year under President Obama’s healthcare law, new research suggests the government insurance plan for the poor has only a mixed record of improving health.

Medicaid beneficiaries are less likely than the uninsured to have catastrophic medical expenses and significantly less likely to suffer from depression, researchers at the Harvard School of Public Health and the Massachusetts Institute of Technology found.

But those on Medicaid did no better controlling their blood pressure or cholesterol levels, raising questions about the program’s ability by itself to help low-income Americans become healthier.

The lack of health gains came even though Medicaid beneficiaries went to the doctor’s office and the hospital and filled prescriptions more frequently than those without coverage.

“I think the study dispels two extreme arguments about Medicaid,” said Harvard’s Katherine Baiker, one of the study’s principal authors and a former member of President George W. Bush’s Council of Economic Advisors.

“Some people say this is a terrible program. Beneficiaries don’t see any improvement in health. It is a waste of resources…. That is clearly not the case. The improvements in mental health are substantial. And there are real economic protections. Medicaid very clearly improved the well-being of beneficiaries,” said Baiker, a professor of health economics.

“At the same time, the study also dispels the opposing view that this is a wonderful program that keeps people out of the hospital and that it provides all this preventive care that saves money. That is also not true.”

The study, to be published Thursday in the New England Journal of Medicine, tracked 12,000 low-income Oregonians who entered a lottery in 2008 to get into that state’s Medicaid program.

The lottery gave researchers a unique opportunity to assess Medicaid by tracking two similar, randomly selected groups: those who won a spot in the health insurance plan and those who didn’t and remained uninsured. Such a randomized trial — standard practice in scientific research — has not been possible in other Medicaid research, some of which has suggested the program leads to worse health outcomes.

Medicaid, which has generated controversy since it was created in 1965, covers more than 60 million people in the course of a year and costs taxpayers nearly $500 billion annually.

The Medicaid debate has taken on new urgency as the Obama administration pushes states to take advantage of the 2010 Affordable Care Act, which provides generous federal aid to help them expand their programs. The law’s supporters hoped state expansions would cover as many as 16 million more low-income Americans over the next decade.

But many states led by Republicans have rejected the option, saying that Medicaid is ineffective. Several conservative critics have even argued that the program is worse than no health coverage.

John Goodman, who heads the conservative National Center for Policy Analysis and advised Republican Sen. John McCain’s 2008 presidential campaign, called the study’s findings about health outcomes “stunning.” “It suggests to me that Medicaid doesn’t matter very much,” he said. “A lot of people are way too focused on health insurance and not focused enough on healthcare.”

Goodman, an economist and health policy expert, favors moving low-income Americans into commercial insurance rather than Medicaid.

The study did not analyze whether health outcomes would have been better in private insurance. But research has consistently shown that, in general, Americans in either public or private health insurance plans often fail to manage chronic medical conditions, such as diabetes and high blood pressure, though some individual health plans and medical providers have succeeded in helping patients do this.

The authors of the study note that factors other than insurance may explain why Medicaid beneficiaries did not control their blood pressure and cholesterol levels, including possible problems with access to good medical care or failures to adhere to prescriptions and doctors’ orders.

But Baiker stressed that the study’s findings of benefits from Medicaid should not be understated.

Beneficiaries were 30% less likely to suffer from depression than those without coverage and nearly 10% more likely to report that their health was the same or better than it had been a year earlier.

And researchers found a dramatic increase in financial security. “That is a basic function of health insurance,” Baiker said. “It is not just supposed to give you access to care. It is supposed to prevent you from being evicted from your house if you suffer a medical emergency.”