Tag: Poverty

Medicaid Budget Cuts: Hospitals will bear the burden, we will pay the price

May 12, 2025

By LINDA RIDDELL & THOMAS WILSON

Recent discussions over Medicaid budget cuts invite us to look more deeply into the house-of-cards that, when it collapses, will hit the states and low-income households hardest. But we will all be harmed.

Some states get 80% of their Medicaid funding from the federal government, as a recent Wall Street Journal article, “Medicaid Insures Millions of Americans. How the Health Program Works, in Charts” pointed out. Even states relying less on federal funds will be hard pressed to shift their resources to replace the federal share. The ripple effects are clear: states are likely to reduce Medicaid enrollment, forcing low-income people to skip care or find free care, and hospitals will shift resources to cover care they are not paid for. Dollars cut from Medicaid do not vanish; they simply shift to different corners of the healthcare system. Ouch!

A Deep Dive into the Facts

Fact 1. Low-Income Households Already Spend More of Their Income on Health Care: Recent Consumer Expenditure Survey data reveals that the lowest 20% of households—roughly corresponding to those enrolled in Medicaid—saw the share of their income spent on healthcare (red in Figure below) rise from 8% in 2005 to 11% in 2023. In contrast, the highest-income 20% devoted only 2% in 2005, rising to about 4% of their income to healthcare in 2023.

Fact 2. Necessities Consume a Majority of Low-Income Households’ Income: Low-income households spend about 57% of their income on essentials like food and housing (blue in figure). This leaves little to nothing for other expenses. These families have an almost inelastic budget where any additional expense, even one as critical as medical care, forces painful trade-offs. In contrast, high-income households have from 38% to 53% of their income (purple in figure) left over after meeting all basic and other costs.

Fact 3. Affordable Care Act Led to Reduced Uninsured ED Visits: In 2016 — two years after Affordable Care Act provisions took effect — many states expanded Medicaid, and all introduced health insurance exchanges. These changes brought emergency department visits by uninsured patients down by half—from 16% to 8%.

Fact 4. Uncompromising Obligations at Hospitals: Under the U.S. Emergency Medical Treatment and Active Labor Act (EMTALA), hospitals must treat and stabilize every patient who arrives, regardless of their ability to pay. With around 70% of all hospital admissions arriving via the ED, a surge in uncompensated care in the ED will directly affect admission rate, the hospital’s core function.

Examining the Key Inferences

Inference 1. Rising Uninsured Populations: Cutting Medicaid budgets is likely to lead to states shrinking enrollment and boosting the number of uninsured individuals.

Inference 2. A Resurgence in Uninsured ED Visits: If Medicaid budget cuts reduce enrollment, the previously achieved reductions in uninsured ED visits could return to the high rates seen before the ACA.

Inference 3. Hospitals Caught in the Crossfire: Budget cuts will force hospitals to provide more uncompensated ED care. The response is likely to be reducing staff, the hospital’s largest cost center — a move that directly affects the quality and timeliness of both primary and specialty services. Washington state offers a cautionary tale, where hospital leaders predict longer wait times and lower service levels due to state budget cuts.

Broad Impacts Beyond the Numbers

The health system must pick up the $880 billion slack, not by magically creating money but by shifting resources from other programs. The healthcare system has its priorities set by the budget scramble–not by the community’s health needs. Health disparities between the rich and poor will widen, and progress made on having more people insured will reverse.

Staff cuts will lengthen wait times and decrease service quality, not to mention they will burn more people out of their health service jobs. The ripple effects of Medicaid cuts will eventually touch all who seek medical care and pay for health insurance.

A Call for Political and Community Action

Now, more than ever, it is time for political stakeholders to recognize that the real cost of Medicaid cuts is borne not just by states but also by communities. Stakeholders, policymakers, community leaders, and the general public must stand up for their own interest in having a sustainable health care funding approach.

Toward a More Equitable Future

The case against Medicaid budget cuts is not merely about dollars and cents—it is about the future of our healthcare system and the health of millions of Americans. Cutting Medicaid benefits may create short-term savings on paper, but it undermines the health infrastructure that serves everyone.

A thoughtful and balanced approach would protect vulnerable populations while ensuring hospitals remain viable centers of care, especially for rural areas. In rural communities, the health sector creates 14% of jobs; rural hospitals are generally the largest employer and since they serve more Medicaid and Medicare patients, they will be the hardest hit by these budget cuts.

The shift in where healthcare dollars are spent could change every layer of healthcare delivery—from the ED’s ever-growing responsibility to inpatient admissions to primary care’s dwindling resources. It is a call for all of us to rethink how healthcare is funded and to stand in solidarity with those at risk of being left without medical care.

Looking Ahead

Beyond the immediate fiscal challenges, this issue invites a broader discussion on healthcare reform. How can we restructure funding to improve efficiencies? Could community health cooperatives or expanded telehealth services help lessen adverse effects? These questions deserve robust debate and decisive action.

In these turbulent times, every stakeholder—from local communities to federal policymakers— needs to find solutions that prioritize human health over short-term budget tactics. The stakes are high, and the choices made today will shape healthcare access and quality for decades to come.

Linda Riddell, MS is a population health scientist specializing in poverty and is the founder of Gettin’ By, a training tool helping teachers, doctors, case managers, and others work more effectively with students, patients and clients who are experiencing poverty. Thomas Wilson, PhD, DrPH is an epidemiologist focused on real-world issues and board chair of the non-profit Population Health Impact Institute

Out of Control Health Costs or a Broken Society

Oct 9, 2023

Flawed Accounting for the US Health Spending Problem

By Jeff Goldsmith

Source: OECD, Our World in Data

Late last year, I saw this chart which made my heart sink. It compared US life expectancy to its health spending since 1970 vs. other countries. As you can see, the US began peeling off from the rest of the civilized world in the mid-1980’s. Then US life expectancy began falling around 2015, even as health spending continued to rise. We lost two more full years of life expectancy to COVID. By the end of 2022, the US had given up 26 years-worth of progress in life expectancy gains. Adding four more years to the chart below will make us look even worse.

Of course, this chart had a political/policy agenda: look what a terrible social investment US health spending has been! Look how much more we are spending than other countries vs. how long we live and you can almost taste the ashes of diminishing returns. This chart posits a model where you input health spending into the large black box that is the US economy and you get health out the other side.

The problem is that is not how things work. Consider another possible interpretation of this chart: look how much it costs to clean up the wreckage from a society that is killing off its citizens earlier and more aggressively than any other developed society. It is true that we lead the world in health spending. However, we also lead the world in a lot of other things health-related.

Exceptional Levels of Gun Violence

Americans are ten times more likely than citizens of most other comparable countries to die of gun violence. This is hardly surprising, since the US has the highest rate of gun ownership per capita in the world, far exceeding the ownership rates in failed states such as Yemen, Iraq and Afghanistan. The US has over 400 million guns in circulation, including 20 million military style semi-automatic weapons. Firearms are the leading cause of deaths of American young people under the age of 24. According to the Economist, in 2021, 38,307 Americans aged between 15 and 24 died vs. just 2185 in Britain and Wales. Of course, lots of young lives lost tilt societal life expectancies sharply downward.

A Worsening Mental Health Crisis

Of the 48 thousand deaths from firearms every year in the US, over 60% are suicides (overwhelmingly by handguns), a second area of dubious US leadership. The US has the highest suicide rate among major western nations. There is no question that the easy access to handguns has facilitated this high suicide rate.

About a quarter of US citizens self-report signs of mental distress, a rate second only to Sweden. We shut down most of our public mental hospitals a generation ago in a spasm of “de-institutionalization” driven by the arrival of new psychoactive drugs which have grossly disappointed patients and their families. As a result, the US has defaulted to its prison system and its acute care hospitals as “treatment sites”; costs to US society of managing mental health problems are, not surprisingly, much higher than other countries. Mental health status dramatically worsened during the COVID pandemic and has only partially recovered.

Drug Overdoses: The Parallel Pandemic

On top of these problems, the US has also experienced an explosive increase in drug overdoses, 110 thousand dead in 2022, attributable to a flood of deadly synthetic opiates like fentanyl. This casualty count is double that of the next highest group of countries, the Nordic countries, and is again the highest among the wealthy nations. If you add the number of suicides, drug overdoses and homicides together, we lost 178 thousand fellow Americans in 2021, in addition to the 500 thousand person COVID death toll. The hospital emergency department is the departure portal for most of these deaths.

Maternal Mortality Risks

The US also has the highest maternal mortality rate of any comparable nation, almost 33 maternal deaths per hundred thousand live births in 2021. This death rate is more than triple that of Britain, eight times that of Germany and almost ten times that of Japan. Black American women have a maternal mortality rate almost triple that of white American women, and 15X the rate of German women. Sketchy health insurance coverage certainly plays a role here, as does inconsistent prenatal care, systemic racial inequities, and a baseline level of poor health for many soon-to-be moms.

Obesity Accelerates

Then you have the obesity epidemic. Obesity rates began rising in the US in the late 1980’s right around when the US peeled away from the rest of the countries on the chart above. Some 42% of US adults are obese, a number that seemed to be levelling off in the late 2010’s, but then took another upward lurch in the past couple of years. Only the Pacific Island nations have higher obesity rates than the US does. And with obesity, conditions like diabetes flourish. Nearly 11% of US citizens suffer from diabetes, a sizable fraction of whom are undiagnosed (and therefore untreated). US diabetes prevalence is nearly double that of France, with its famously rich diets.

No, the Poor Don’t Always Have to Be With Us

Jul 18, 2023• 1

BY KIM BELLARD

OK, for you amateur (or professional) epidemiologists among us: what are the leading causes of death in the U.S.? Let’s see, most of us would probably cite heart disease and cancer. After that, we might guess smoking, obesity, or, in recent years, COVID. But a new study has a surprising contender: poverty.

It’s the kind of thing you might expect to find in developing countries, not in the world’s leading economy, the most prosperous country in the world. But amidst all that prosperity, the U.S. has the highest rates of poverty among developed countries, which accounts in no small part for our miserable health outcomes. The new data on poverty’s mortality should come as no surprise.

The study, by University of California Riverside professor David Brady, along with Professors Ulrich Kohler and Hui Zheng, estimated that persistent poverty – 10 consecutive years of uninterrupted poverty – was the fourth leading cause of death, accounting for some 295,000 deaths (in 2019). Even a single year of poverty was deadly, accounting for 183,000 deaths.

“Poverty kills as much as dementia, accidents, stroke, Alzheimer’s, and diabetes,” said Professor Brady. “Poverty silently killed 10 times as many people as all the homicides in 2019. And yet, homicide firearms and suicide get vastly more attention.”

The study found that people living in poverty didn’t start showing increased mortality until in their 40’s, when the cumulative effects start catching up. The authors note that these effects are not evenly distributed: “Because certain ethnic and racial minority groups are far more likely to be in poverty, our estimates can improve understanding of ethnic and racial inequalities in life expectancy.”

The UN’s Extreme Poverty Report: Further Evidence US Healthcare Is Divorced From Reality

Aug 22, 2018• 5

By DAVID INTROCASO, Ph.D.

Skid Row in Los Angeles

In May Philip Alston, the United Nation’s Special Rapporteur on Extreme Poverty, and John Norton Pomeroy Professor of Law at New York University Law School released his, “Report of the Special Rapporteur On Extreme Poverty and Human Rights on His Mission to the United States.” The 20-page report was based, in part, on Alston’s visits this past December to California, Georgia, Puerto Rico, West Virginia and Washington, D.C. After reading the report and the response to it, one is again forced to question how legitimate is our concern for the health and well being of the poor, or those disproportionately burdened with disease.

The UN report found over 40 million Americans live in poverty, or upwards of 14% of the population. Those living in extreme poverty number 18.5 million and 5.3 million live in 3^rd World absolute poverty. Among other related statistics, Alston cites the fact the US has the highest comparable infant mortality rate, 50% higher than the OECD mean, due in part to an African American mortality rate that is 2.3 times higher than that of whites. The US has the highest youth poverty rate in the OECD. In 2016, 18% of children were living in poverty comprising 33% of all people in living poverty and 21% of those were homeless. These facts are explained in part by the report noting between 1995 and 2012 there was a 750% increase in the number of children of single mothers experiencing annual $2-a-day poverty. US poverty, the report explains is due in part to the continuing growth in income and wealth inequality. The report found in 2016 the top 1% possessed 39% of the nation’s wealth while the bottom 90% lost 25% of its share of wealth and income. Since 1980 annual income for the top 1% has risen 205% and for the top .1% by 636% while annual wages for the bottom 50% have stagnated. The report reminds us the US has approximately 5% of the world’s population but 25% of its billionaires. The US in sum ranks 18^th out of 21 wealthy countries in labor markets, poverty rates, safety nets, wealth inequality and economic mobility.

Socialism Kills

Nov 7, 2012• 23

By John Goodman

In a recent Health Alert I evaluated Paul Krugman’s claim that ObamaCare is going to save “tens of thousands of lives” and the repeal of ObamaCare will lead to the death of “tens of thousands” of uninsured people.

Krugman’s bottom line: Mitt Romney wants to let people die. The economics profession on this same subject: Krugman’s claims are hogwash.

But there is something that does cause people to die: socialism. More precisely, the suppression of free markets (the kinds of interventions Krugman routinely apologizes for) lowers life expectancy and does so substantially.

Economists associated with the Fraser Institute and the Cato Institute have found a way to measure “economic freedom” and they have investigated what difference it makes in 141 countries around the world. This work has been in progress for several decades now and the evidence is stark. Economies that rely on private property, free markets and free trade, and avoid high taxes, regulation and inflation, grow more rapidly than those with less economic freedom. Higher growth leads to higher incomes. Among the nations in the top fifth of the economic freedom index in 2011, average income was almost 7 times as great as for those countries in the bottom 20 percent (per capita gross domestic product of $31,501versus $4,545).

What difference does this make for health? Virtually, every study of the subject finds that wealthier is healthier. People with higher incomes live longer. The Fraser/Cato economists arrive at the same conclusion. Comparing the bottom fifth to the top fifth, more economic freedom adds about 20 years to life expectancy and lowers infant mortality to just over one-tenth of its level in the least free countries.

Heroin Vaccine Won’t Cure What Ails Addicts

Apr 19, 2012• 5

By Angela Garcia

My aunt Marion is in the hospital dying of liver and kidney failure, the result of her 20-year struggle with heroin use. I was told of her imminent death the same day news broke about a vaccine against the drug. “Breakthrough heroin vaccine could render drug ‘useless’ in addicts,” one headline read. “Scientists create vaccine against heroin high,” proclaimed another.

Meanwhile, my aunt finds temporary relief in the ever more frequent administration of opiate pain medication — the very kind of drugs she used illegally.

The idea of an anti-addiction vaccine is not new. For nearly 40 years scientists have been working on vaccines against all kinds of addictions, including nicotine, marijuana and alcohol. There are even trials of vaccines to prevent obesity. None of the anti-addiction vaccines has yet received Food and Drug Administration approval, however, and most of the studies are still in their early stages.

The headlines trumpeting a heroin vaccine were based on a finding that the drug had proved to be effective on mice during trials in Mexico (a nation that could use some good news related to drugs). Scientists now plan to test the patented vaccine in humans. If all goes well, the vaccine could be available in five years — too late for my aunt but providing a glimmer of hope for the estimated 1 million heroin addicts in the United States. Perhaps.

Six years ago, when I was a doctoral student researching heroin addiction in northern New Mexico, I received an email from a scientist studying a possible vaccine against the drug’s use. The study was in rat models, but early results were promising and suggested the likelihood of a therapeutic effect for humans. Aware of the devastating heroin epidemic in New Mexico, which had the highest rate of heroin-related deaths in the Unites States, and of my work trying to understand it, the scientist wanted to offer some hope. He wrote that he could imagine a time when heroin addiction, in New Mexico and around the world, would be a thing of the past. I wanted to believe him, but I was less optimistic.