Medicaid-ization of American social services (part 2)

My first post noted that the expanded role of Medicaid has implications beyond the usual realm of health care. As states face increasing incentives to rely on Medicaid to deliver social services, this will strongly influence who can access services, which organizations can or choose to provide these services, overall expenditures, and relationships between the states and the federal government.

An overall shift towards Medicaid financing is a good thing. States need the money from the federal Medicaid match. The boundary between health and social services is inherently murky in many areas, such as mental and behavioral health. So the proper delivery of health services often requires accompanying social services. If a single mom needs (for example) residential drug treatment, Medicaid coverage for child care and support services might be essential to make this option feasible.

Medicaid also provides greater freedom of choice to social service clients. Social services are often financed through block grants or contracts that implicitly or explicitly ration services by fixing the available supply.   Liberals and conservatives don’t like to put things this way. Yet as Steven Rathgeb Smith has noted, Medicaid replaces this fixed model with something closer to a voucher program. Recipients can seek services from whoever is willing to take Medicaid rather than be stuck with whatever agency has some contract from the state. As with school vouchers, the devil is in the details. Because the voucher is rather open-ended, one must decide how to control costs while ensuring that Medicaid provides effective access to needed services. Do Medicaid reimbursements properly accommodate individuals’ varied needs and circumstances? Are these reimbursements sufficient to attract skilled providers?

Within medical care, Medicaid often fails the last market test. (To pick one example among a myriad of others, an audit study of Cook County pediatric medical specialty practices found that most would not schedule appointments for children with public insurance coverage.) Yet payment disparities play out quite differently in social services, for which Medicaid is often actually the most generous payer. Expanded Medicaid eligibility and coverage for substance abuse treatment provides a financial foundation for these services. It also may provide new incentives for other organizations, such as Federally Qualified Health Centers, to enter this market.

Yet as Christina Andrews is exploring, many drug treatment centers aren’t tooled-up to bill Medicaid or to satisfy other Medicaid requirements in administrative record-keeping or in the provision of evidence-based practices. These facilities may lack computers. They may not satisfy other Medicaid requirements, such as having a doctor on staff to formulate a treatment plan. Scott Allard and Steven Rathgeb Smith worry about the have/have-not divide between large and sophisticated organizations equipped to receive Medicaid reimbursement, and less-sophisticated have-not organizations that cannot.

I take a harder edge on these questions. Many social service organizations that lack proper information technology, professionally credentialed staff, and other infrastructure to meet Medicaid requirements also lack the technical facility to really provide effective, evidence-based care. (See, e.g. my work with Tom D’Aunno on the organizational correlates of under-dosing in methadone maintenance treatment.) Some of these organizations can really improve given the right technical assistance and management oversight.

Yet the reality is that many organizations survive that provide very poor services. Their clients have few realistic alternatives, and these organizations are just not held particularly accountable for quality or for outcomes. If health reform and related policies don’t drive many such facilities from the market, I will be disappointing.

Another issue bears mention, which arises in Matthew Spitzmueller’s work here in Illinois. Once Medicaid becomes the main financing mechanism, what happens to people who need help but who are not Medicaid recipients? Some of these individuals are undocumented immigrants. Others are just needy people who don’t qualify for Medicaid. Here in Illinois, the state has increasingly sought to constrain a growing deficit by making it harder for non-recipients to access community mental health services.

The human consequences of such policies can be painful. When we moved my brother-in-law into our home, he faced serious medical and social service challenges. At a moment of crisis, he was severed from most services and entitlements because he had just crossed state lines. We were settling his parents’ financial affairs after his mother’s sudden death. He was living in our home, which posed administrative complexities. We had no real idea what we were doing. Meanwhile, the social service agencies we turned to for help refused to even place us on waiting lists until we secured an Illinois Medicaid card. This was expected to take many months. Things worked out. Yet that was eight years ago. Things are tougher now.

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