Scoppe: Medicaid: the clash of public health, economic reality

Associate EditorFebruary 6, 2013 

— TONY KECK makes a good point when he says the medical system in our state and nation is “producing way too much cost and way too little outcome.”

He points, for example, to a study that found that 85 percent of the people in the United States whose blood pressure is out of control have health insurance and a regular physician. Although the insured fare better than the uninsured — 50 percent of hypertension patients with insurance have their blood pressure under control, compared to just 30 percent of those without insurance — neither number is impressive. Or healthy.

“Our goal should be to get people healthy, and to get adequate care to people,” he said during a recent visit with our editorial board. “Insurance and Medicaid aren’t necessarily the best way to get people to the care they need.”

Mr. Keck runs South Carolina’s Medicaid program, which means he runs the largest health-insurance program in our state, with 1 million enrollees. That number is projected to rise by 160,000 as people who are already eligible sign up because of the insurance mandate of the Affordable Care Act, or Obamacare. It could go up by another 350,000 if the state expands the program to cover single adults up to 138 percent of poverty. Which Mr. Keck is at the forefront of opposing.

Although it feels a lot like Gov. Nikki Haley and others oppose expanding Medicaid simply because it’s President Obama’s idea and because South Carolina would have to pick up part of the cost, which could possibly require higher taxes, Mr. Keck builds his case around the “insurance-doesn’t-equal-health” argument.

He acknowledges that having health insurance is beneficial, but he contends that how healthy someone is depends much more on “social determinants” than on access to health care.

He continues his analysis of the blood-pressure study. “You get the same overall health benefit by improving the treatment rate for the 50 percent (who are insured) as getting the uninsured insured,” he said, and it costs a lot less to do that.

There’s nothing new — or particularly Republican, or even controversial — about the idea of spending less money to get better health. It’s the central idea of public-health initiatives that long have been advocated by left-of-center organizations, and an increasing number of employers and even insurance companies.

Any public-health advocate will tell you that a dollar spent on getting people to exercise more, eat less, quit smoking and reduce alcohol consumption is worth far more than a dollar spent on treatment after they have a heart attack or stroke or allow their diabetes to go uncontrolled so long that they suffer kidney damage or have a leg amputated.

That is, essentially, what Mr. Keck wants to do: Identify those populations, practices and even geographic areas where health is the worst, and develop public-health programs to change people’s behavior. He would simultaneously use his buying power to force medical providers to stop providing expensive treatments that don’t work.

He’s done that already with the Birth Outcomes Initiative, which halved the number of babies who were delivered early for convenience rather than necessity, saving $6 million in the first quarter of this fiscal year alone. Elective early births tend to be more expensive, about one in 10 result in super-expensive premature births, and medical experts agree that later deliveries are healthier even for those babies who wouldn’t have been premature.

Mr. Keck already can make such changes within the Medicaid system, but he argues that it will be impossible to continue making significant progress if the state accepts billions of dollars in new funding to expand Medicaid.

“If you pour all that money into the system, the focus turns to building up the system, and you lose focus on efficiency and improving health-care outcomes,” he says. “From just an operational perspective, it has the potential to just throw the system out of whack.”

There’s some truth to that contention, although I think it’s a question of degree rather than an either-or proposition. And if I could redesign our health-care system, I’d do it Mr. Keck’s way.

But here’s the thing: I don’t have that power. And neither does he. Or the governor. Or anyone else in South Carolina.

While creating a smart new approach to health can produce better health per dollar, it can only produce better health for South Carolina if he can buy the same amount of health for $1 as the traditional system can buy for $10. And I’m just not convinced he can. Five dollars maybe. But not 10.

The problem is the way Medicaid in general, and the Medicaid expansion in particular, is funded. The federal government will pay $9 for every $1 South Carolina spends to expand Medicaid to cover more of the working poor; it will pick up 100 percent of the cost for the first three years.

What this means is that South Carolina and other states do not have the luxury of behaving logically, of considering merely where we get the best health per dollar spent. The hard reality is that it’s economic folly for us to refuse to buy some things we might not need — which boggles the mind until you remember that the entire U.S. economy is built on Americans buying bigger houses and cars and throw-away appliances and a lot of other things we don’t need.

Outrageous? Absolutely. But it’s reality.

We can argue all day about whether the rules under which states must operate Medicaid make sense (and I think many of them do not), or whether creating the Medicaid expansion program was something the federal government should have done.

But it won’t make a difference, because it’s done, and South Carolinians are going to help pay for the Medicaid expansion throughout the country. The only choice we have — the only choice — is whether or not we will allow the federal government to send any of our money back to us.

Ms. Scoppe can be reached at cscoppe@thestate.com or at (803) 771-8571.

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