Medicaid buy-in proposals prompt similar worries as 'Medicare for all'
State proposals to allow residents who don't qualify for Medicaid to buy into the program are gaining steam, but providers are concerned that could cut deep into state budgets, drive physicians out of Medicaid's already-skimpier networks and shift more costs to the commercial insurance market.
Providers' worries about state Medicaid buy-in options are similar to their unease over the "Medicare for all" plan pushed by Sen. Bernie Sanders (I-Vt.), which is gaining steam with progressive Democrats in Congress. They aired those concerns Wednesday at America's Health Insurance Plans' conference in Washington.
On a basic level, Medicaid buy-in supporters haven't figured out if they're to solve the remaining uninsured rate or barriers to care, according to Catherine O'Mara, executive director of the Nevada State Medical Association who has worked closely with her state's Legislature on the issue.
"Access to health insurance and access to healthcare are not the same thing," O'Mara said. "This is a huge concern for providers. If health insurance plans are unaffordable, then people can't see a provider. But if we're trying to solve for the cost aspect alone, then we will be off-balance: we can have an insurance plan that is affordable without doctors to see."
But the uninsured rate may need a different solution, O'Mara said. Just over 11% of Nevadans don't have insurance now, and about 7% to 8% of Nevadans are undocumented immigrants who can't obtain coverage without a state policy change aimed at them.
Designing Medicaid buy-in proposals is complicated, according to O'Mara and other panelist. It isn't a new idea, but the policy doesn't have a universally accepted definition. States could offer a Medicaid managed care plan on the Obamacare individual market exchanges, partly funded for people who qualify for Obamacare subsidies by the federal government. Or Medicaid buy-in could stand as a public option that competes with the Obamacare exchange plans, with the risk assumed by the state.
A plan that offers the same level of benefits as Medicaid could cost nearly twice as much as a benchmark plan on the exchanges, according to John Holahan of the Washington-based Urban Institute. Medicaid benchmark coverage includes all ten of Obamacare's mandatory essential health benefits as well as other provisions including non-emergency medical transport, adult vision and dental care, free choice of family planning clinics and — significantly — long-term care.
While the average benchmark plan on the Obamacare exchanges has an average deductible of more than $4,000 with a nearly $7,000 out-of-pocket limit for patients, Medicaid typically doesn't come with any cost-sharing, unless a state has obtained a waiver for that.
But those increased benefits come with costs. Medicaid networks tend to be narrower thanks to lower provider reimbursement. Medicaid patients can make up about 30% of a Nevada physician's payer mix, O'Mara said.
Typically, Medicaid pays 90% of Medicare rates for inpatient hospital stays, versus the commercial rate of roughly 175% of Medicare. Medicaid pays just over $500 for an emergency visit, while a commercial insurer pays an average of $1,676. For physicians, the difference is even greater, with Medicaid payments often averaging around 66% of Medicare.
"We need to keep having these conversations," O'Mara said. "But I'm not sure this is the right option."
However, she cautioned, the option may turn out more like a safety-net in case of bare counties or as a pilot program. And she said that supporters and stakeholders should decide whether they want to pursue the policy as a stand-alone or as a path to single payer.
In Congress, Rep. Pramila Jayapal (D-Wash.) — who launched the "Medicare for all" Caucus in the House this year — has been wary of a public option, warning that if it fails it could stall or derail movement toward a single payer system.
Momentum for Medicaid buy-in grew in Nevada in 2017, as the GOP-controlled Congress pushed measures to overhaul Obamacare and cap Medicaid funding. The state's moderate Republican Gov. Brian Sandoval vetoed a proposal by Democratic Assembly member Michael Sprinkle that would have authorized the option for the state's individual market exchange.
In his veto message, the governor concluded that the measure raised more questions than it answered and ultimately stood as "an undeveloped remedy to an undefined problem." Instead, he approved a feasibility study that would explore the buy-in proposal, dubbed SprinkleCare in the press but formally known as the Nevada Care Plan. The task force issued a final report late last month and other states, notably New Mexico, have launched similar studies.
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