New Study Builds Case for Expanding Medicaid

A new study in the New England Journal of Medicine confirms what consumer health advocates have known for decades: Medicaid is essential for keeping low-income households on stable financial footing. This should come as no surprise, since protecting families from unexpected and devastating medical costs is exactly what health insurance is meant to do. The study also proves that Medicaid coverage significantly improves beneficiaries’ mental health.

But opponents of Medicaid have distorted the study’s results; they claim it supports their agenda to block millions of low-income, uninsured families from accessing this vital coverage program. Their arguments are misinformed at best. The new study only strengthens the case for expanding Medicaid.

What the study tells us: Medicaid Works!

The researchers looked at the health and finances of low-income, uninsured Oregon residents who were given the opportunity to enroll in Medicaid through a one-time lottery, and compared it to their peers who remained uninsured.

The study shows that Medicaid virtually eliminated all catastrophic medical expenditures (medical expenses exceeding 30 percent of household income) for its beneficiaries. It also indicates that people with Medicaid coverage are significantly less likely to face any medical debt, borrow money to pay bills, or skip payments.

These results are extremely promising, especially in light of the fact that medical bills currently prompt more than 60 percent of U.S. bankruptcies. If we want to reduce the drag bankruptcies create on our economy and the ruin they leave behind in our communities, providing low-income families with Medicaid coverage is a good place to start.

The study also found that Medicaid is a powerful tool in combating mental illness. Medicaid beneficiaries in the study were 30 percent less likely to suffer from depression than those who remained uninsured. Given that suicide takes more lives in the US than any other form of injury and that depression accounts for more than $83 billion in the US between lost productivity and medical expenses, the impact of Medicaid on depression deserves attention and celebration.

File Under: Non sequitur

Instead of celebrating, opponents of Medicaid are arguing this study makes the case for withholding Medicaid coverage from millions of low-income, uninsured families. They base this on the study’s failure to detect statistically significant improvements in a handful chronic disease measures — blood pressure, cholesterol, or hemoglobin levels — in those with Medicaid compared to those without coverage.

That’s like saying because your blood pressure didn’t go down, we are going to prevent you from getting coverage for cancer treatment or a pap smear.

It’s certainly true that the U.S. health care system needs to be better at managing chronic conditions. We routinely lag behind other industrialized nations on measures of chronic care management, such as following medical guidelines for treating hypertension and diabetes. Plus, this study only looks at the impact of two years of coverage; significant improvements in these persistent chronic illnesses may take much longer to materialize.

This is hardly a reason to block millions of low-income families from gaining health coverage they need and deserve. We have no evidence that people with private insurance or Medicare fare any better than Medicaid beneficiaries on these measures, yet no one is suggesting we should all drop our health insurance.

Getting people covered is the first step in creating an effective health care system that works for everyone, but it is not the only step. The ACA contains numerous initiatives to improve the quality of health care.

File under: extremely relevant

Meanwhile, dozens of states are still trying to decide whether or not to take up the option to extend Medicaid coverage to millions of low-income, uninsured adults. This study confirms Medicaid can give beneficiaries peace of mind that they won’t go bankrupt when they experience that unexpected illness, and make staggering improvements in their mental health. It adds to the growing list of reasons why this decision should be a no-brainer for all 50 states.

Katherine Howitt, Senior Policy Analyst
Community Catalyst

(This blog was first published on the Community Catalyst Blog)