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Medicare, Medicaid and the Rising Tide of Health Care Costs: Will We Ever Get It Right?  

Steven Kairys, M.D at his desk.The national debate continues about the right to health care coverage.

Nine states are developing programs to add various administrative verifications to continue to receive Medicaid and to demand those able to work to demonstrate 20 hours a week of work or volunteer time in order to maintain health care coverage.

This tug of war about benefits and entitlements and the use of tax dollars to support those in financial need extends well beyond health care. The same controversies smolder for family leave, for home visiting and parenting supports, for early childhood education, for nutritional supports for infants and children and for substance abuse services.

Only if one is truly disabled by birth or happenstance are services available without loss of dignity or concerns about abuses and laziness and the right to meaningful care. Better to wind up in renal failure, no matter the reason, then to have a chronic disease exacerbated by inadequate housing, food, or mental health crises.

Root causes of our national polarization are not obtuse. We are a country that prides itself on personal freedom and independence: the New Hampshire Live Free or Die morality; the American mythos that the rare stories of people making it out of desolation are the normative path for anyone with the will and energy to follow; the moral failures of those left behind. This is the American Myth embedded into every controversy about rights and privileges.

These American Myth success stories are more persuasive in our national debate on benefits and entitlements than all the data and studies that continue to pile up to refute the Myth-- especially for the population of swing voters who are themselves poor and hanging on – who believe that it is all "those others" that abuse the system and take away dollars and services that should be aimed at the more deserving.

For New Jersey, so much of this national debate seems out of touch with our reality. Medicaid in NJ covers a family of four making less than 86,000 a year— four times the poverty level and so generous and beyond the coverage in almost any other state. And thus, families in poverty, families beyond poverty but struggling to meet the high cost of living and the even higher cost of living without sickness, have the benefits denied to so many others.

This focus solely on health care coverage obscures in some ways the real aim of the coverage— does that coverage gain access to effective health care? Does that coverage result in increased health status, in quality of life, in the ability to work and go to school?

Medicare, designed to provide health care to everyone over the age of 65 is our version of national health insurance – the rates paid to providers are the norm and are accepted by primary care and specialty physicians alike and there is no debate about rich or poor or deserving or not deserving. Medicare is the health care of the land for our elderly.

Retired couple sitting at a table, going through paperwork. Medicaid, Medicare's poorer cousin, does not share that foundational structure. And in many ways, Medicaid is merely an empty gesture. Every state has not only its own coverage rules but also its own strategy for how to manage the program. New Jersey, so generous in its eligibility parameters, is next to last in the country (only to Rhode Island) in its reimbursement to physicians, especially to specialists, surgeons and psychiatrists. Any even primary care doctors shun Medicaid for the most part because the payment is so poor compared to commercial insurance; and the health and social needs and the missed appointments due to family crises and lack of transportation make it simpler to provide care to those with fewer variables out of the control of health care.

So even though every managed Medicaid company can show you that their lists of providers includes all sorts of specialists, almost all of those specialists limit the number of Medicaid patients seen. And there simply are no private practice child psychiatrists that will see Medicaid patients. For many emergency rooms, there are coverage systems that ensure that a child or adult on Medicaid will be seen – but that does not mean that the follow-up care will be done by that provider. Many tell the emergency room patient that the family will need to find a provider that takes Medicaid for the follow up care.

So how valuable is the Medicaid insurance card if the health care that it opens up for the family is limited and fragmented and regularly changing. Does this coverage gain the family access to the health care that we would envision for all families— the health care available to anyone with a Medicare card?

There are some alternatives that have been developed to shore up the inequities. Federally qualified health centers serve only those in poverty and the primary care physician reimbursement is increased in these centers. There are over 22 such FQHC’s in NJ but even with enhanced services they struggle to find specialists to see their families. Moreover, the wait times are, by all accounts, long and the FQHC’s ultimately serve only about 20% of the families with Medicaid.

Thus, despite all the national arguments about eligibility, having a Medicaid card, even if eligible, does not equate to quality health care. The systems of coverage rules and care authorizations are often too complicated to work through solutions that are meaningful in the context of wellness.

In New Jersey, it would seem that the only way forward out of this quagmire is to put the needed transformation into the hands of the large health care systems emerging throughout the state. If these large conglomerates of hospitals and health care providers can be given the responsibility to make the broad changes in health care delivery and care management, then there is hope of radical departures from the current disarray.

Conglomerates taking risk, either as full scaled accountable care organizations or as systems working with managed Medicaid companies to transfer the risk, is transformative because it places the responsibility for better health and better outcomes and for less unnecessary redundant care to the health care system. It allows them to marshal the resources they already own or control toward different ends. Better preventive care rather than regular emergency medicine care; better support of social needs and housing and transportation rather than readmissions and costly end stage solutions. Better care management and patient engagement rather than missed appointments and excessive medications and testing.

And even though the current structure benefits the status quo by keeping our hospitals and emergency rooms full, opportunities still exist. The epidemic of the aging is upon us, with looming increases in the need for hospital beds and resources. Far better to deploy current hospital resources toward that looming storm, and to use current managed care Medicaid dollars to finance the health care processes that are already in play and those still in formation (e.g., telehealth and patient home aides) to start now. Better to start while there is time to experiment and to use some of the current excess in health care profits to mitigate the crushing costs of the future that will soon be upon us.

Yes, it is always difficult to predict the future. But demographics don’t lie and the baby boomers have effected a critical mass at every stage of their lives’ journey. Health care is feeling their aging presence now and will continue to do so for decades.

The cautionary tales of companies that failed to heed the call of the future are everywhere. And the list of those who failed to adapt and adjust litter the history books of commerce and the lives of those who made their livings in these industries.

Think Kodak film, and the failure to embrace the digital format to which it had early access. History is clear that the companies that took charge and accounted for seismic change, even while ahead, continue to be leaders. I would suggest that such a time and such decisions are upon those in health care now.

Steven Kairys, M.D., MPH, is Chairman of Pediatrics at the K. Hovnanian Children's Hospital at Hackensack Meridian Health, Jersey Shore University Medical Center and Founding Chair of the Department of Pediatrics at the Hackensack Meridian School of Medicine at Seton Hall University.

Categories: Health and Medicine

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