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Benefits of providing medical insurance to the poor is undeniable

Dominika Osmolska Psy.D.'s picture

In the wake of the announcement yesterday by some states that they are cutting payments to Medicaid, a landmark study out today settles the question once and for all: do poor people fare better when given health insurance? The resounding answer is yes.

When poor people are given medical insurance, they feel better, see their doctor more regularly, and maintain more financial stability, a study by the National Bureau of Economic Research confirms. They are also presumably healthier, making use of diagnostic and preventative services provided by their health care team. Should we be surprised at these outcomes? They certainly seem obvious – common sense dictates that when individuals are given a safety net, they will lead more stable, happier lives.

Given the study’s results and given our presumably shared human common sense, why is there such a contentious debate around insuring the poor, and, in a related vein, insuring everyone?

The debate rages between those who say of course it would help and those who say maybe not. Among the reasons given against expanding Meidcaid, one of the most puzzling, to say it mildly, is the assertion that a safety net already exists. This safety net comes in the form of emergency rooms, charity care, free clinics and the option to go to a doctor and simply not pay the bill.

OK, let’s look at these so-called safety nets individually. Emergency rooms: to make an appearance in one solely because one has run out of options and cannot further delay treating a condition because it has become life-threatening can hardly be called functional medical care. I have heard emergency room stories from my uninsured clients that make one’s hair stand on end. Is allowing a uterine fibroid to grow unchecked for years because one does not have a gynecologist to turn to acceptable? In this particular instance, the young woman was hemorrhaging before making an appearance at the county hospital. And even then, her pleas were not taken seriously until she passed out on the bathroom floor, covered in her own blood. Some safety net.

Charity care and free clinics? Believe me, they are more strapped for cash than the state is. Gosh, so much of their funding comes from the very government grants enabling Medicaid coverage. Cutting Medicaid will precisely affect those very institutions. Last time I checked I did not see Bill and Melinda Gates checking in on my client with a tooth abscess so serious, he was threatened with meningitis. All the free clinics turned him down because the procedure was so expensive and requiring technical expertise beyond their ken. Even the school of dentistry didn’t let their interns experiment on him for fear of the liability issues involved. What was he supposed to do? Extract it himself? He finally defaulted to safety net option number one, as above. He, too, had to plead his case for a month of agonizing, pounding, won’t-let-you-have-a-single-uninterrupted-thought kind of pain that went on all day and all night long.

And last but certainly not least: go to the doctor and don’t pay the bill. This one takes the cake for safety net award of the year. Really? Do you really suppose the man with the abscessed tooth could get away with that? He wouldn’t receive treatment in the first place, never mind not pay for it. I mean, come on, folks. Doctors are not that stupid. The first thing the receptionist asks when you step through the doors of the clinic is, what is your insurance plan? And they can check, right there and then, should you have any plans to make that one up. And let’s say you did get away with it. How would you like your credit ruined, hounded, day and night, by hostile, aggressive credit-collection calls? Maybe by then you, too, would want to hole up in some den deep in the hills.

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Opponents of Medicaid do have at least one valid objection: the system is so mismanaged and ruinous on doctors’ time that people will still have trouble seeing a doctor because so few accept that insurance. But let me reiterate: the solution is not to leave a vast segment of the population without any insurance at all. A reform of Medicaid, yes. Doing away with it, no.

The heated debate – and the study that follows it – was fomented through a unique situation in Oregon three years ago. Oregon was running out of money and had to choose some people to get insurance and exclude others, providing groups for comparison. In 2008, the state wanted to expand its Medicaid program to include more uninsured people but could afford to add only 10,000 to its rolls. Yet nearly 90,000 applied. Oregon decided to select the 10,000 by lottery. Economic researchers saw an amazing opportunity: Here was their chance to compare those who got insurance with those who were randomly assigned to go without it. This had never been done before, in part because it would be considered unethical to devise a study that would deny some people coverage while giving it to others.

This situation was perfect for assessing the impact of Medicaid, said Katherine Baicker, professor of health economics at the Harvard School of Public Health, one of the principal researchers of the study. She saw it as an unbelievable opportunity to actually find out once and for all what expanding public health insurance does.

Dr. Amy Finkelstein, professor of economics at M.I.T. and the other principal researcher, was interested in whether Medicaid did what all insurance — homeowner’s, auto, health — is supposed to do: shield people from financial catastrophe. Shockingly, almost no one had ever tried to investigate that question scientifically – perhaps because it does seem so damn obvious.

Here are some of the study’s results: Those with Medicaid were 35 percent more likely to go to a clinic or see a doctor, 15 percent more likely to use prescription drugs and 30 percent more likely to be admitted to a hospital. Researchers were unable to detect a change in emergency room use.

Women with insurance were 60 percent more likely to have mammograms, and those with insurance were 20 percent more likely to have their cholesterol checked. They were 70 percent more likely to have a particular clinic or office for medical care and 55 percent more likely to have a doctor whom they usually saw.

The insured also felt better: the likelihood that they said their health was good or excellent increased by 25 percent, and they were 40 percent less likely to say that their health had worsened in the past year than those without insurance. They were also 25 percent less likely to have an unpaid bill sent to a collection agency and were 40 percent less likely to borrow money or fail to pay other bills because they had to pay medical bills.

Do you think that adds up to a healthier, happier life? You bet.

Dr. Baicker underscored that being uninsured is stressful from a financial perspective, a psychological perspective, a physical perspective. “It is a huge relief to people not to have to worry about it day in and day out,” she said.