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Cheaper and Better Ways than Expanding Medicaid to Get Health Insurance Coverage to the Working Poor?

The excellent health-care weblog The Incidental Economist: argues with itself on the best route forward for Medicaid:

First:

Austin Frakt:

Start by paying a primary-care physician $80 a month to see each [Medicaid] patient, whether he is healthy or sick. That’s what so-called concierge doctors charge, and it would give Medicaid patients what they really need: first-class primary-care physicians to manage their chronic cardiovascular and metabolic conditions. [...]

Then throw on top of that a $2,500-a-year catastrophic plan to protect the poor against financial ruin. The total annual cost of such a program would be $3,460 per person, 42 percent less than what Obamacare’s Medicaid expansion costs.

-Reihan Salam, National Review Online quoting Avik Roy

Interested in what health policy wonks and primary care providers think of this proposal...

Second: Aaron Carroll: Quote: Medicaid Reform – a response:

Basically, [Austin] is looking for a response to Reihan and Avik’s proposal that we couple concierge care with a catastrophic plan for Medicaid. I think this misses a huge part of care. Physician time shouldn’t be minimized. But this plan would involve a huge deductible for everything else. So how would preventive care get paid for? Things like colonoscopies, mammograms, and laboratory panels aren’t cheap. How would maternity care get paid for? One third of births occur on Medicaid.

Would we expect people below the poverty line to have thousands of dollars to pay for deductibles for this stuff? Cause they won’t have it. A baby will bankrupt them. They’ll avoid necessary care because they can’t pay the deductible. And if you start adding in preventive care and maternity care and deductibles they can afford back into the plans, you’ve got… traditional Medicaid.

There’s a reason things are the way they are. If it were easy to “innovate” our way out of this, we would have done it already.

Absent from Reihan Salam--and from Avik Roy--is any sense of what a $2500/year catastrophic insurance coverage program gets you...

As you may or may not know, I am not allowed into the http://healthcare.gov website because I cannot remember which of the expenditures on veterinary treatment for our late Yellow Lab in the last six months of her life was classified by Experian as "insurance". It was, needless to say, not insurance--the health-insurance market for Yellow Labs more than 10 years old is in complete adverse-selection meltdown. But Experian thinks one of them was, and I cannot figure out which.

So over to the California exchange "Covered California" https://www.coveredca.com we go. We find a bug in their address database--it insists on introducing an extra comma, and refuses to allow the abbreviation "St." for "Street" to contain a period. Otherwise, we are in.

And the winner is... Blue Shield Silver: for a male individual in his 50s in Berkeley, CA, $6144 in annual premiums plus an estimated $3597 in annual out-of-pocket expenses. A $2500 annual plan plus $1000 in annual doctor visits would thus, in the minds of Blue Shield's actuaries at least, leave me expecting to spend $6000 a year out-of-pocket--unless you are heaping subsidies on top of the program, and thus spending more than $2500/year on insurance and $1000/year on monthly appointments.

So by the time we have anted enough subsidies into the mix for a $2500/year policy to genuinely "protect the poor from financial ruin" our savings vis-a-vis expanded Medicaid are dubious indeed--not 42%.

Of course, it may well be worth doing--the "concierge" model, that is (although I would see it more as nurses going door-to-door making their once-a-month house calls on everybody rather than as providing the pastel-stained-glass soft-music burbling-water scented waiting rooms of, say, the Sutter Alta Bates Summit Women's Health Center at 3959 Mt. Diablo Blvd. in Lafayette, CA).

But let me second Aaron Carroll on this:

There’s a reason things are the way they are. If it were easy to “innovate” our way out of this, we would have done it already.

667 words...

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