Medicaid Transformation

Glancing at the headlines and editorials from around the state, it appears that a great deal of the discussion, at least in the political discourse, revolves around a proposed drastic expansion of the welfare entitlement of Medicaid.  In economic terms, the expansion will cost taxpayers billions of dollars over the next several years.  Although I remain committed to investing in our State’s healthcare system, especially for those who truly need our assistance:  our seniors, the disabled, the truly destitute and children who have no other resources; I am opposed to a rudimentary knee jerk welfare expansion proposal because I believe Medicaid should be be transformed.  Let’s take a quick snapshot at reality and set aside our ideological beliefs on the program for just a moment.

According to the Department of Insurance, Financial Institutions, and Professional Registration (they track all doctors licensed to practice in Missouri) there are 19,628 Doctors of Medicine (MDs) and 3,145 Doctors of Osteopathic Medicine (DOs).  According to numbers obtained from the Department of Social Services (they track the Medicaid program) only 88% of MDs accept Medicaid.  Amongst DOs, however, the contrast is even worse.  Of all DOs in Missouri, only 33.19% are even registered to accept Medicaid. 

Those who are in the field of healthcare are likely not surprised by this figure.  One reason is that DOs routinely perform certain forms of treatment that are not reimbursed by Medicaid – it is the nature of their methods.  But another cause is likely as follows:

Most MDs practice in larger hospital systems and in more urban areas.  There will be DOs at these hospitals, but you will find a much larger percentage of DOs practicing in our rural areas – perhaps with their own small practice – than in urban regions.  Our urban areas are also home to much larger populations of individuals and families covered by strong, private insurance policies.  These policies, along with the size of the larger hospital systems, allow the more urban facilities to leverage the profits they realize from private insurance carriers against the heavy losses they see when they care for individuals on Medicaid.  In many cases, our rural areas do not have this luxury – doctors in small, private practice shops literally cannot afford to accept Medicaid patients.

The ugly truth that lies within the Medicaid program is that it compensates providers at alarmingly low rates.  Often, this rate is barely above 50% of what the same provider would receive in payment from Medicare – the federal health insurance program for our nation’s senior citizens (and even that rate often cannot match private insurance).  Steven Lipstein, CEO of BJC HealthCare, alluded to the ramifications of Medicaid’s low reimbursement rate and its negative impact on healthcare costs in an article appearing on STLToday.com on January 15, 2013.  I would encourage you to read it – the link is below.

For these reasons and several more, simple Medicaid expansion, as President Obama and Governor Nixon have proposed, will only exacerbate a broken system.  Even worse, it costs taxpayers billions in borrowed money with no end to the unprecedented deficit spending in sight.  Let me reiterate: simply giving an individual a Medicaid card doesn’t ensure them access to care.  This is a fact.  And yet, that is the only solution the left has offered.  Your Republican leadership will actually propose innovative solutions to the healthcare crisis in our state.  Look to our members to propose ways to transform Medicaid and not just kick the can down the road and saddle your children with debt in the process.

To read the article mentioned above, please follow this link: http://www.stltoday.com/news/opinion/columns/why-medical-charges-appear-to-be-so-high-and-still/article_be563466-f91d-5db6-8ce4-c448f9a1d5ad.html