Is It Time To Charge Medicaid Members for ER Usage?

Is It Time To Charge Medicaid Members for ER Usage?

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No one would deny that we’ve reached a point in public healthcare finance where tough choices have to be made about what gets covered and what doesn’t. There is, however, one fairly easy choice, and that is to reconfigure the $3 copay for Medicaid members using the emergency room.

I would propose a replacement benefit of $0 for the first visit and $20 for each subsequent one, in a given calendar year. Not every state, but any state that reaches certain thresholds for physician access or urgent care availability may switch to this policy.

Here are the arguments in favor. First, each $3 visit costs the state and federal government about $500.  There are few discretionary or semi-discretionary patient decisions that cost so little to trigger so much taxpayer spending.  (Hospitalizations have that kind of ratio, but a patient can’t check himself into a hospital the way he can visit an ER.)

Second, one must consider the historical context. The $3 copay (“$3″ is a shorthand for $0 to $10 — I don’t think it is over $10 anywhere) is a vestige of the bad old days when it was very difficult to find physicians who accepted Medicaid patients. That is still the case in some locales; they would not be eligible for this waiver. The world has changed, but the copay hasn’t.

Third, ER utilization rates in the TANF population, which because of its average age is generally pretty healthy, far exceed that of the commercially insured population. This is despite the fact that TANF members in general cost much less than commercially insured people, a gap that widens still further once birth events are removed from the calculation. Clearly there is much excess utilization.


Fourth, while avid readers of this blog may recall that I am no fan of North Carolina Medicaid, my objections are confined solely to their consultant’s math — Milliman USA embarrassed themselves and their client by coming up with obviously impossible conclusions. See here. By contrast, I do think they (meaning Community Care of North Carolina) have done as good a job as possible under public-sector constraints to enhance access to care for Medicaid members, and my hat goes off to them for the tremendous efforts they’ve made.

However, what we’ve learned from that experiment is that the best-designed network in the world won’t attract Medicaid members if the ER is basically still free. Yogi Berra called this one right:  “If people don’t want to come to the ballpark, you can’t stop them.”  For this model or any other access models to be given a chance to work (and to be given a chance to pay for themselves), member economics have to support the access strategy.

Finally, this is not a take-away. The proposal would be $0 for the first visit — a cost savings. And obviously if someone shows up for a second visit without $20 and it’s a true emergency, that person wouldn’t be denied care.  (It also may not be easy to check eligibility for the $20, but most of the value of this policy is in people thinking that they might be charged $20, and deciding to go to their doctor instead.)

All the old objections need to be discarded or can be addressed. Yes, transportation may be hard to come by but most doctor offices are more accessible than most hospitals. Yes, after hours doctor offices aren’t an option.  That could be addressed by a call to a doctor to clear a visit to the ER.

I’m sure there will be objections — the THCB regulars are nothing if not opinionated — but please make sure to propose an alternate way to save a large chunk of money involving more savings and less of a take-away.

Al Lewis, president of the Disease Management Purchasing Consortium, is author of the critically acclaimed 2012 humorous look at the innumeracy of health plans, consultants and vendors, Why Nobody Believes the Numbers.

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62 Comments on "Is It Time To Charge Medicaid Members for ER Usage?"


Guest
phillip
Jun 6, 2014

I think all of you need to go the ER with only Medicaid. See how you are treated. I have had always had good insurance through my employer. I have a fiance’ who is on medicaid. She started having bad tremors which was a side effect of an anti-depressant. She couldn’t walk she was shaking so bad. They checked her vitals and everything looked ok. The Dr. walked in and told her she was faking. Oh and this was at Baylor medical center in Dallas. The little nurse said she didn’t think this was an emergency. Well if she was at home and couldn’t get up to walk to the bathroom ; I wonder if that would be an emergency. It was because she was on medicaid. I never been treated the she way she was.

Guest

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Chat soon!

Guest
Al Lewis
Dec 15, 2012

I think you are referring to some of the more recent comments, and may recall from the actual article 59 comments ago that I myself did not point fingers but rather (1) proposed a $0 copay for the first visit, which is $3 better than now and (2) suggested that only states meeting primary care access standards could qualify for that.

I would certainly concur in your comments about reducing utilization for other large users by addressing their needs, but it shouldn’t be an either-or. You may be able to use savings from unnecessary ER visits for the worried well to finance your suggestion.

Guest
Finger pointing
Dec 15, 2012

Why do Medicaid ED visits attract anger and controversy disproportionate to the amount we spend on them? The highest users of healthcare dollars have frequent hospitalizations (they may go thru the ED but the point is that they are very sick and require admission) and/or require total long term care at home or in a nursing facility. There is a lot of reason to believe that we can reduce the huge expenditures on the very sick by addressing their needs (for example, search for Gawande’s article on hot spotters on the net). Spending on a single diabetic patient who requires multiple ICU admissions this year due to failure to address mental health barriers to keeping blood sugar levels in reasonable control blows the unnecessary ED visits of hundreds of families out of the water.
Further, it is convenient to point fingers at the very poor who go to the ED for primary care needs but the really big dollar abuse of the system may in fact be middle class families who evacuate elders’ assets to get their nursing home care paid for by Medicaid to the tune of a great deal of public spending on the behalf of middle class families.

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MD as HELL
Dec 2, 2012

I am declaring victory.

Guest
kelli bean
Dec 12, 2012

I agree with you good doctor.

Guest
MD as HELL
Dec 2, 2012

MD as HELL is a 30 year physician in the same ED providing care to all who present themselves believing they have an emergency.

Originally we screened out nonemergency complaints and sent them to an on-call physician who was oblidged to see them once without demanding payment. It worked until the feds passed EMTALA. The medical staff became less interested in playing ball and courts decided that anything short of treatment was not “stabilized”.

In 1982 in a county of 100k population we had 18000 ED visits plus 6000 nonemergency screenins referred out.

In 2012 we have 60,000 annual visits in a county of about 130k population.

Today the ED remains the destination for people who have no capacity to deal with acute minor illnesses that require no physician, much less a rescue squad and an ED.

We are the second opinion specialists. See the Pediatrician in the daytime and go to the ED at night when the kid still has a fever. No barriers when you are on Medicaid.

After 15 years my company has more money in collections than we have actually received in the last 15 years. From 4 docs in 1982 to 10 docs and 10 PAs in 2012 my personal purchasing power after taxes is lower now than it was in the 1980’s.

I see the same patients over and over. i see the same Mcaid and Mcare enabled irresponsible behavior over and over.

I am no Scrooge. I give more than I get. This country is going down due to these runaway entitlement programs fueling citizen greed and sloth. All the nice people on this blog are goodhearted and want to do the right thing. I promise you no one dies if they cannot go to the ER ;like they do now.

This country is addicted to healthcare. Why break the bank feeding the addiction when people can live better and happier without it?

Guest
Peter1
Dec 3, 2012

“I am no Scrooge.”

Then come up with a more elegant solution instead of taking your bitterness out on Medicaid recipients.

Guest
MD as HELL
Dec 5, 2012

In fact I am not. They are treated like pets. They have no accountability for their expenditures. They have no budget. They have no constraints.

The soluton is to give them x dollars a year. What they do not spend they keep. the left howls that they will forgo needed healthcare and keep the money. That means they are treated like pets; incapable of determining what care they need on their own. Hence the disconnect between me and the left.

You must treat them like equals and let them fail if they so choose. There children are theirs. Let the evolution begin.

Guest
Peter1
Dec 5, 2012

“They have no accountability for their expenditures.”

What expenditures, they’re the poorest of the poor.

“You must treat them like equals and let them fail if they so choose.”

They’ve already failed, that’s why they’re on Medicaid.

If you’re no Scrooge then stop thinking and speaking like one. Bring back debtor’s prisons eh MD, that’ll teach’em.

Guest
MD as HELL
Dec 5, 2012

OK. Then let them have consequences instead of rewards. I do not believe they have failed. I believe they are smarter than the blogger who thinks they need all this help. The bleeding heart do-gooder who is blind to the scam.

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Al Lewis
Dec 1, 2012

Agreed

the original article (way up at the top of this thread) says you’d only do this in states that reach certain thresholds for physician access.

Doctors can preach all they want, but even commercially insured members rarely make the lifestyle changes they need to make. That’s why obesity hasn’t declined and smoking is declining only at a very slow rate.

Hence I think you’d have to set the standard for access more objectively than you are suggesting, unfortunately.

Guest

Medicaid patients can’t afford to pay more. That’s why they’re on Medicaid. And many times they can’t find a doctor who will treat them in an office because reimbursement rates for Medicaid patients are so low. One solution is to increase payments for providers who understand how lifestyle changes can prevent, reverse, or slow chronic illness. Advanced chronic illnesses are expensive.

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Al Lewis
Dec 1, 2012

Yes. I personally have programmed my computer so that his comments don’t show up.

btw I think there are only three of us left in this thread so I vote that we all declare victory and get out.

Guest
Al Lewis
Dec 1, 2012

Doug, of course that’s what you said. This board is not moderated so there is no requirement that comments have to reflect adulthood in order to be posted. When I send this thread to my West Wing contacts, I’ll be deleting half of these comments.

Guest
d.d.
Nov 30, 2012

My suggestion was to:

(1) pay the provider (a fair rate) for providing an EMTALA screen, even if performed by a non-MD
(2) allow them to not provide ED care if not warranted
(3) strengthen legal and safe harbor protections for not providing care

…. how does that “penalize the hospital” ? (Especially compared to the situation today.)

In terms of changing patient behavior, my version of the scheme allows EDs to not provide care beyond an EMTALA screen, if that screen shows that no “emergency” exists. And strengthens protections against denial of care allegations.

Someone not needing emergency care can sit in the ED for 12, 24, or 72 hours, but they’re not going to get care from our most expensive resources unless they have a genuine need. To get access to the care they want, they will have to go to their PCP, or a community clinic, or an urgent care center.

Would you keep going to an ED where you’re not going to get care, or after a few long, pointless waits would you decide you just might ought to go the PCP/community clinic/urgent care center in the first place ?

Guest
MD as HELL
Nov 30, 2012

Sorry. I just replid to an automated esponse in my email. your proposals also will not work.

#1. Care will retrospectively be determined to have not been needed.
#2. Denying treatment again will be retrospectively be determined to have been appropriate.
#3. When patients complain to CMS or DFS (in NC) there will be time-consuming investigations into those decisions.
#4. It still does no change the behavior of the culprits.

Guest
d.d.
Dec 1, 2012

@Md as HELL:

I disagree on #4 that behaviors won’t change, but I can see where there could be a concern on your first three points. You have a very valuable point there, that I did not think about.

Those all relate to “compliance responses” that have been developed in response to real or perceived abuses under the current system of reimbursement and access. If policy makers significantly change the ED system in the ways suggested, then hopefully there would be a recognition that the old compliance mechanisms also need to be reviewed and modified, to make them appropriate for the new rules.

Guest
Peter1
Dec 1, 2012

d.d., if you haven’t been on this blog for long then you fail to see that “MD as Hell” is a health care Scrooge who would like to see a Dicksonian health care system where children still worked in factories to pay for their health care and debtor’s prison is where we held those on Medicaid.

Guest
d.d.
Dec 1, 2012

Coming to agreement on system changes often requires acknowledging and addressing the substance of objections raised by affected parties, even if they come in a prickly wrapper.

Guest
MikeQ
Nov 30, 2012

There is a pony in this pile of proposals and comments, especially the last one. Anyone who doesn’t think that ED overuse in Medicaid isn’t a problem is simply wrong, and yes, being “free” and billboard signs and habit and perceived (and sometimes actual) lack of access all contribute.

And in this thread are elements of an elegant solution.

I might add two more things:
(1) Reimburse at the urgent care rate for non-emergencies, like they do in Illinois
(2) Track the hospitals against one another and investigate all “outlier” hospitals. Like with RAC audits, miscoding would be penalized.

Guest
MD as HELL
Nov 30, 2012

Another m***n wanting to short the hosppital for doing it’s job.

Mcaid and the beneficiary need to do their job! Stay out of the ED with your whiny crap!!

Guest
d.d.
Nov 30, 2012

hey, MD as HELL, it seems your goal of “stay out of the ED” is the same as the goal of @Al’s post and the other comments on this blog … would you mind enlightening us with a little more detail on exactly why you think these policy recommendations would not work?

Charm alone will not carry this argument.

Guest
MD as HELL
Nov 30, 2012

Penalizing the hospital does not change the behavior of either the patient or the politician.

Guest
Douglas Dame
Nov 30, 2012

This article and discussion is excellent. I think part of a satisfactory solution would involve:

* Medicaid paying a ED “(facility) triage fee” for the EMTALA screening, even if done by an RN/ARNP/resident rather than an MD. If nothing is paid, then the financial incentives are for the ED to upcode to “real emergency” to get paid. Let’s not encourage that, and let’s not encourage cost-shifting the burden of EMTALA screenings onto the other patients.

* clarification that if a reasonably diligent EMTALA screening for a true “emergency” is done, the hospital can and should refuse treatment, without liability. (I think there was a EMTALA lawsuit recently related to this issue, and the patient lost.) There may be a need for the Feds to develop more Safe Harbor guidelines on this.

* No payment to hosp or ED docs for non-emergency ED care, other than for the triage service.

* many Medicaid patients go to the ED because they get faster access than to a primary care physician. Or pediatrician. If we change that to “if you seek non-emergent care at the ED, you’ll wait a long time, and at the end you’ll leave after x hours without getting any care*,” then people will learn to change their behaviors. What used to work for the Medicaid patients, won’t work any more. (* They do get a confirmation from a medical professional that their problem, or their kid’s problem, is seemingly not an acute problem with life-threatening implications. That’s an outcome of some value, of course.)

Two additional observations:
* If there is a facility EMTALA payment, AND patients who are not deemed to be emergencies are 100% turned away (unless they want to pay cash, in lieu of going to an urgent care provider), then the amount of any co-pay becomes moot in terms of modifying behaviors …. going to the ED for a non-ED problem simply wastes your own time, with no result.
* The works for all payors, not just Medicaid. Unnecessary ED utilization is expensive to society, regardless of what payor source.

Guest
MD as HELL
Nov 30, 2012

Great!! A m***n wanting to change behavior by conditioning the wrong party.

Guest
Peter1
Nov 30, 2012

Yes, have them self diagnose with WebMD to see if they’re really sick.

Guest
Nov 29, 2012

Of course I would and so would most other people — it’s simple economics. Last summer I stepped on an oyster shell. It didnt’ realyl require an ER visit but I thought given the location of the cut it would be better to have a pro clean it out,. I was on the fence so I called the insurer to check my co-pay and called the ER to see if they were busy. The copay was “only” $50 and the ER had no wait at that point, so I went.

Now make the copay $3 and add those billboards about waiting times and watch economics at work.

Guest
Nov 29, 2012

“simple economics” are replete with totemic anecdotes, long on confirmation bias laden theory, and short on science, Al.

Guest
Nov 29, 2012

I wouldn’t have gone, but OK, let’s assume that for the incidental minor cut and bruise people would go.
Regulators are requiring all sorts of things to be in place in a hospital, why can’t they require that every major ER has attached to it (not across the street or three blocks down) a simple urgent care facility, and patients are triaged accordingly (all patients, not just the poor ones) when they come in?

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MD as HELL
Nov 30, 2012

Typical solution: Someone else gets to sort out the chaff from the wheat. Who pays for the sorting? Do you think that will be free?

Most patients do not need the ED. Not just Medicaid patients. In fact most people do not need all this healthcare at all.

We need to stop turning healthcare into a religion.

Guest
Nov 30, 2012

Yes, it is a typical solution, because I don’t think we need any radical solutions for this, and no, it’s not free, but it should be significantly cheaper for all involved.
The question, of course is whether “all involved” have any interest in making anything cheaper, as opposed to making things inaccessible for those who can’t pay exorbitant and unnecessary prices.

And I agree with you that most people don’t need any of this stuff, so maybe “all involved” quit spending billions on advertising, construction and lobbying instead of spending it on what it was originally billed out for – medical care for those who need it.

Guest
MD as HELL
Nov 30, 2012

But they do not need it.

Guest
Peter1
Nov 30, 2012

This won’t get solved until health care spending gets treated as an expense and not as income.

Single pay with spending budgets would turn that mentality around.

Guest
Nov 28, 2012

Maybe I’m reading this wrong, Al, but the OECD database does not show that we do more cardiac surgery that other individual countries in Europe, some of which seem to be on a stenting rampage…
http://stats.oecd.org/index.aspx?DataSetCode=HEALTH_STAT#

Regarding the $3 vs. $500, would you go to the ER for a headache (or whatever), if it was only $3, or even completely free? Would you go more often to the ER in that case? If your answer is no, then there must be a different reason for this behavior.