• Point/counter-point: Should states expand their Medicaid programs?

    Aaron and I take up the pro-Medicaid expansion side of the latest point/counter-point in the Journal of Health Politics, Policy and Law. Joe Antos represents the con side. Harold Pollack introduces the debate. I was told that all papers are would be ungated in advance of their appearance in print. Alas, they are not, but I’m working on it. Indeed they are ungated!

    In case you don’t know, the way this worked is that Aaron and I wrote our piece, then Antos got to read and react to it. So, though Antos had the opportunity to respond to us directly in print, we did not get to respond to him. So, I’ll make a few counter-counter-points here. You may wish to read the papers first. In doing so, I encourage you to note (even write down) your prior view on Medicaid expansion. Then see if either we or Antos moved your view. Let us know in the comments along with anything you think was left out of the debate or that any of us got wrong.

    First, here are some areas in which we all (mostly) agree:

    • State elected officials are politically constrained in their choices. Antos is quite explicit on this (“If you choose the latter [Medicaid expansion in your state] you stand a good chance of being thrown out of office the next election.”) We discuss politics at the end of our paper, concluding that it is not our job to look after the political fortunes of state officials. That they will (or won’t) expand Medicaid and that they should (or should not) are separate matters.
    • Expanding Medicaid is not free for the states. Reading Antos’s paper you might think we dispute that, but we don’t.
    • Antos makes a direct appeal to the virtue of choice. We don’t take that up in our paper, but we do not dispute that there is value in choice.
    • The Medicaid expansion was a lower cost means of increasing coverage. Antos and we acknowledge that private coverage costs more, as would increasing Medicaid payment rates to providers.
    • States may be able to use the Medicaid expansion as a bargaining chip, to extract favorable waivers from the Center for Medicare and Medicaid Services (CMS). We wrote that, and Antos seems to agree. We also probably all agree that this is among the most important unsettled areas to watch in terms of health policy.

    Here are some things on which we (may) disagree:

    • We do not agree with Antos that no coverage can be better than some coverage. To be sure, sometimes medical care can be harmful to health. But far more often it isn’t. As I’ve written before, half of recent longevity gains are due to medical care. Insurance is key to access to care (PDF), even insurance with constrained provider choices like Medicaid. (Private coverage is also highly constrained.) Antos cites Bokus et al. (2009) and provides some access statistics from that work. He does not indicate the degree of access problems for the uninsured, nor do Bokus et al. Oregon’s Medicaid randomized experiment — the strongest evidence we have about the effects of the program — shows that the uninsured have far worse access to care than do Medicaid enrollees.
    • Though greater rates of insurance will increase demand for care and likely increase waiting times for certain services in certain areas, we wonder if those unable to afford insurance today should wait for us to solve the workforce (and cost control) problems? (We don’t think so.) If they should be made to wait, how long?
    • We don’t agree that health care coverage should be secondary to addressing other social problems, like inability to afford food or providing a good education. We think health care, food, and education are all worthy of our attention and, yes, government spending (redistribution). Further, we don’t think that any of these are at odds with promoting a “sound economy and a brighter future” (per Antos’s final paragraph). They are integral to it. Healthy, sufficiently fed, well-educated people are better workers and more voracious consumers.

    I’ll leave you with one final point: I remain puzzled why those who find the ACA too expensive also seem to advocate for more expensive alternatives (more choice through private coverage, say). I’m perfectly comfortable with an all-private health insurance system, one with more choice for all, provided everyone has access to affordable coverage. But I own the fact that it will be more expensive than the one we have. I also am far from convinced that going all-private is the only way to improve our health system.


    • Austin,
      Re: your last paragraph. While private coverage costs more, those who favor a less federalist approach see the aggregate spend as lower, not higher, no? A premium might be costlier, but with higher OOP costs and “efficiencies” initiated on administrative side, among other things, they might see the world differently. It may be an incorrect view, but they have convictions in its correctness.

      • Sorry, your comment strikes me as a bit of a word salad. Hard to parse. Adjusting for benefits and taking account of selection, I’m not convinced shifting spending from public to private insurance by itself saves anything system wide. If one wants to claim uncertain “efficiencies” will do the job, fine. But whether they really will is an empirical question. Like I’ve said many times, I’m more than happy to see that experiment play out, e.g., via premium support, so long as there are safeguards in place to protect consumer welfare in case things go awry.

    • For clarity:
      Those who take the market approach see the higher upfront cost of private plans not as a cost shift, but a means to lower overall costs through their management approach to care.

      I am not saying you (or me) must agree with it, but it is their view.


      • Sure, but it’s the management that would reduce costs (maybe) and increase quality (maybe). Could public plans achieve that? Could ACOs? Seems like there’s room for debate and experimentation. And, throughout, one must be very careful that “management” isn’t just management of risk (cream skimming) but of care. This is often a major limitation of studies in this area.

    • Conservatives are opposed to any program which increases the number of persons who are dependent on the federal government.

      That is their prime motivation.

      The faults that they find in public programs are sometimes just thrown together after the fact….”if you don’t like these, I have others….”

      Antos is less doctrinaire than others, but my general observation holds true.

    • “While private coverage costs more….”

      – Interesting data on private, non-group coverage costs and benefits here:


      “Oregon’s Medicaid randomized experiment — the strongest evidence we have about the effects of the program — shows that the uninsured have far worse access to care than do Medicaid enrollees.”

      I’m sure that’s true, but all that establishes is that giving people access to medical services worth several thousands of dollars makes them better off than people in the same situation who are given nothing.

      The data would be much more interesting and useful if the comparison was between people who were enrolled in Medicare and those who received a transfer worth the same amount. E.g. either a health-insurance-voucher worth the amount spent annually to provide care to the average Medicaid recipient in their state, a cash equivalent that they could use to purchase medical care directly, or some combination of the two.

    • Hi, this question was raised by me in another post but I think it fits better here:

      I’m interested in the implications of the paragraph you guys wrote: “The waiver necessary for [expanding Medicaid only to 100% of the FPL] would not be routinely granted; according to policy, waivers must be [federally] budget neutral (National Health Policy Forum 2009). In principle, a state might attempt to craft a partial expansion that is lean enough to offset the additional federal costs (e.g., by paring back benefits), though it is uncertain that would be viewed favorably by DHHS.”

      I’m curious: do you think this is even possible? It seems to me that the difference in costs to the federal government make this a fantasy, but because it is raised a serious possibility I feel like I’m missing something.

      • For us to see it, you need only raise it in one post, though maybe this increases the visibility for others. To your question, of course it is technically possible, but probably very hard. I don’t have much else to say.

    • The bpld solution is to federalize Medicaid, and raise income taxes about 2-3 per cent to do this.

      No more race to the bottom. No more counter cyclical prressure on state budgets.

      We tend to forget that Medicaid was originally a kind of throw-in during the Medicare legislation of 1965. Southern state legislators barely approved Medicare (because it integrated hospitals, oh the horror!), and so these ‘conservative’ racists would only accept a Medicaid if the individual states could virtually opt out of it.

      Not much has changed!!

      Any country in northern Europe would never allow an individual state to opt out of basic social protections.. Time for us to grow up to.

      (This does not mean that Medicaid for the young has to be pure fee for service. I also do not like the ‘cliffs’ in Medicaid, where if your income is $11,999 you get free health care, and if your income is $12,001 you get a high deductible piece of crap.)

      But bascially we must federatlize, and then improve the details.