Medicaid, a radical suggestion for reform

Medicaid, neither as it exists today nor how it changes under the Affordable Care Act can assure access for the poor. Additionally, costs will not be affordable. Many providers will not see Medicaid recipients, chronic diseases will not be managed, and care will be provided in emergency rooms rather than in more appropriate locations. A radical “do over” may be the best solution.

First, remove nursing home care from the Medicaid program. Combining long-term care in the program distorts the financial costs and hides the different drivers of costs. There is a need to create a new federal program for long-term care. We must also eliminate all activity by the individual states. By running Medicaid as a single payor system, the overhead costs can be drastically lowered.

Second, give states the flexibility to care for the poor. Two of the best provisions of the affordable care act are accountable care organizations (ACOs) and the expansion of community health centers (CHCs). If states would capitate, rather than pay fee-for-service, ACOs and CHCs would align incentives to care for the poor. In some cases a catchment area could be assigned where all eligible recipients would be the responsibility of the provider. What works in an inner city may be different than what works in a poor rural area.

The suggestions may seem radical, but until we change the framework to provide care to the poor, we fail as a nation in meeting our moral obligations.

Ed Howe blogs regularly at Action for Better Healthcare.