The hidden costs of reducing Medicaid: Planet Money: NPR

With the passage of the large republican tax and bil expensesThe federal government is about to reduce the support of Medicaid and the insurance markets established by the affordable care law. The Congressional Budget Office believes that these cuts could cause 10 million Americans Losing health insurance by 2034.

Legislators justified these cuts as a necessary step to approach the largest budget deficit exacerbated by tax reductions and other expenditure increases in the major invoice. However, this does not capture how these cuts will send costs that will spread in society, to be paid by hospitals, clinics, individuals, then in the end, to the federal government.

Where do people go if they are not insured?

Health care is different from other products, such as film tickets, cocktails or cars. If people cannot pay health care, they suddenly stop needing it. So where do people get health care if they have no health insurance?

An option is Federal qualified health centers (FQHCS) – Community clinics that offer low -income people with full primary care, dental services, mental health and drug addiction services and specialized care. The FQHC invoices a subsidized rate Depending on the capacity to pay, with 90% of their patients at or below 200% of the federal poverty line. They are a vital source of care for unhealthy or sub-assured, with too much 15,000 sites serving more than 31 million patients 2023.

Of course, the reduction in the number of people on Medicaid will reduce taxpayers to go to the Medicaid program. But the FQHCs are counting on Medicaid patients as their Main source of incomeAnd use the funding of federal government grants to cover the costs of providing non-assured care. The covers with the coverage of Medicaid, without a proportional increase in federal subsidies to cover the costs of unaffected, could threaten the stability and scope of the FQHC. Even with subsidies equivalent to $ 5.6 billion in 2023FQHCs operate on thin razor marginsAnd the drop in registration in Medicaid after the COVID-19 pandemic exacerbated their financial tension. Thus, unless the increase in grant financing, clinics may have to Reduce expenses per patientcould Have more trouble recruiting and retaining medical suppliersOr Reduce the number of services offered to patients. This could lead to more assured patients to use the hospital’s emergency rooms to fill the gap.

Hospitals as an assurers of the last resort

Due to various factors, hospitals must treat patients regardless of their ability to pay. For example, federal law Requires hospitals to provide care to all patients who appear in their emergency services. In addition, federal law requires that non -profit hospitals must provide certain Community advantage through charitable careOr “Free health services or at reduced prices” To maintain their exempt tax status. Non -profit hospitals are an important source of care – almost half of all hospitals in the United States non -profit. Medical ethics also obliges doctors to be “Good Samaritans” And treat patients regardless of their ability to pay.

Thanks to the exempt status of non -profit hospitals, taxpayers effectively subsidize some of these charities for the uninsured. But cutting Medicaid will also harm hospitals. Half of rural hospitals are already operatingAnd the Medicaid cuts threaten to Push 300 additional hospitals “to a tax cliff”. Although concerns about rural hospitals have led to an additional $ 50 billion allocated to one “Rural health processing program“An analysis of Kff believes that this compensates for a third of the lost income Medicaid cuts.

A paper By economists Craig Garthwaite, Tal Gross and Matthew Notowidigdo Maintains that hospitals act as “insurers of the last resort”. When political decision -makers have reduced MEDICAID registrations, hospitals finally have the cost. According to Macpac (The Medicaid and Chip payment and access commission), hospitals have provided $ 22.5 billion in unpaid care for people not insured in 2021, for a total of almost $ 40 billion spent for charity and bad debts (or approximately 5 to 6% of hospital expenses). Using the hospital’s financial data, the authors believe that for each visit to the unwelcome, hospitals support $ 11,000 in unpaid care costs.

Non -profit hospitals, both religious and secular, report higher non -remunerated care costs. When the uninsured population increases, for -profit hospitals report small and insignificant effects on unpaid care costs. Each additional additional person in the country leads, on average, to an additional $ 800 that hospitals pay in unpaid care costs.

Medical debt

Until now, we have found that the increase in the uninsured population places financial charges on two important parts of social security net: community health clinics and non -profit hospitals. But what about the patients themselves?

Even among those who have health insurance, expensive medical invoices associated with high deductibles and cost sharing can cause medical debt and, in some cases, bankruptcy. A Kff analysis noted that 20 million people, or about 8% of adults, have a form of medical debt, with around 6% of adults due to more than $ 1,000. In total, people in the United States have $ 220 billion in medical debt. The incidence of medical debt is higher among unused people (11%), low -income people (11%) and people with disabilities (13%).

Being uninsured and having a hospital stay for hospitalized patients can spell a financial disaster. This studyEntitled “The economic consequences of admissions to the hospital”, notes that having an admission to the hospital, although not insured, increases the probability of bankruptcy by almost 40%. They believe that admissions to the hospital is estimated at around 6% bankruptcy For uninsured, and even 4% of bankruptcies for the insured.

However, research systematically shows that obtaining coverage can save the non -insured of medical ruin. Using Medicaid extensions in the mid -1990s and early 2000s, another study notes that an increase of 10 percentage points of MEDICAID eligibility reduces consumers’ bankruptcies by 8%. The famous Oregon health insurance experienceWho randomly gave the coverage of Medicaid people, finds similar results. Having health insurance reduces the probability that an unpaid medical bill sent to collections agencies by 25% and reduces the probability of having unconditional medical expenses by 35%.

Poor health makes us poorer

Being uninsured is, of course, bad for your health: the unwanted receive less preventive careHave more trouble getting prescription drugs and dental care, and are less likely to obtain the specialized care They need. It is also economically bad for unwelcome as we have shown above. But a more unhealthy population is also bad for the economy itself: long -term evidence shows that insurance coverage as a child improves future productivity in adulthood. At the age of 28, those who had coverage of Medicaid as a child had higher college inscriptions, higher wages and used fewer government benefits. This article considers that the government was able to recover 58 cents on each dollar spent on coverage of infantile Medicaid. Having a sick workforce is just bad for economic growth: poor health workers work for fewer hours, reducing our global Labor productivity.

Thus, the federal government can save money by tightening the eligibility for Medicaid, but that will test other parts of the economy. Community health clinics, hospitals, patients and taxpayers will all be placed on the invoice in some respects, and of course the not insured themselves.