Bloomberg News

Obamacare Seen Straining Clinics With Medicaid Expansion: Health

October 07, 2013

St. John's Well Child and Family Center in Los Angeles

The silhouettes of patients are seen in the waiting room at the St. John's Well Child and Family Center in Los Angeles, California. Photographer: Patrick T. Fallon/Bloomberg

They start showing up at the St. John’s Well Child and Family Center in Los Angeles at 5 a.m. By the time the doors open at 8 a.m., as many as 60 patients are queued up in a line that stretches down the street.

In South L.A., where St. John’s is one of the few organizations that makes doctors available to the poor, the lines may soon get much longer. More than 5 million additional Americans are expected to enroll over the next two years in Medicaid, the taxpayer-funded insurance for the poor that’s expanding Jan. 1 under the Affordable Care Act. Yet 43 percent of doctors in California and a third nationwide won’t take new Medicaid patients. Low pay is one of the reasons.

A shortage of Medicaid doctors will leave many newly insured seeking care in a two-tiered system in which they will have access to less experienced medical staff, longer travel times to find a doctor who accepts Medicaid, and be subject to appointment waiting times sometimes weeks longer than those with private coverage. The advent of the law, rather than help, could make a bad situation even worse as overwhelmed clinics, like St. John’s, struggle to meet greater demand, according to doctors and policy analysts.

“It has been very difficult for Medicaid beneficiaries to get primary care and find physicians who will accept Medicaid,” said Catherine Sreckovich, a managing director at Navigant Consulting Inc. (NCI:US), who has worked with state Medicaid agencies for more than 25 years. “That challenge will continue to grow as more people have insurance and are competing for the same limited set of physicians.”

State Option

Much of the attention on Obamacare has centered on the law’s insurance exchanges, which opened Oct. 1 and allow people to shop online for health plans. Millions have flooded the marketplaces since then, causing them to close down or work slowly. This weekend, the federal government partially closed its healthcare.gov site during the early morning hours to add capacity and fix bottlenecks, after announcing it had recorded 8.6 million visitors over the first three days.

Less noticed has been the law’s provision to provide states funding to expand their Medicaid programs to individuals making as much as 133 percent of the federal poverty level, far more generous than eligibility requirements in most states prior to the law. So far, 25 states have said they plan to expand Medicaid, according to the Kaiser Family Foundation.

While the law greatly improves access to coverage for the poor, it’s unclear how much that will translate to improved care. Medicaid pays an average of 34 percent less for all services than Medicare, the U.S. program for the elderly and disabled, according to data from the Menlo Park, California-based foundation.

Per-Visit Costs

In some states, the payments are as low as $29 for a 30-minute visit with a patient, $277 for delivering a baby and $357 for a cataract surgery. In California, Medicaid pays $25 for a pelvic exam and a pap smear compared with as much as $200 from private insurance.

In New Jersey, where Medicaid payments are about half of what Medicare pays, 60 percent of doctors said they won’t take new Medicaid patients, according to study in the journal Health Affairs. Many Medicaid enrollees in the state go to the ER now because they have trouble getting to a doctor’s appointment, said Katherine Grant-Davis, chief executive of the New Jersey Primary Care Association, which represents federally funded health centers that focus on the poor.

“Doctors can make more money treating rich people and they don’t really want to deal with the poor because they are tough to follow and they have more complex health problems,” said Arthur Caplan, director of the division of medical ethics at New York University in Manhattan who has studied the disparities in Medicaid coverage. “The more you make medicine into a business, the more you put it in the hands of people with an MBA, the poor become less interesting.”

Longer Wait

In a 2011 study, two-thirds of callers trying to make an appointment with a specialist for a child on Medicaid were denied care compared with 11 percent of kids with private insurance. The Medicaid children who were able to get an appointment had to wait an average of 22 days longer than the privately insured ones, according to the study published in the New England Journal of Medicine.

Medicaid patients can find it difficult to see a fully certified doctor even at nonprofit hospitals. At New York City’s major teaching hospitals, including New York Presbyterian and Mount Sinai, those with Medicaid seeking an appointment with a specialist are more likely to be seen by a doctor still in training because many of the board-certified staff doctors won’t take Medicaid, said Ronda Kotelchuck, chief executive officer of the Primary Care Development Corp., a New York-based nonprofit group focused on expanding primary care to under-served areas.

Less Coordinated

While the medical residents and fellows are overseen by a fully-trained attending physician, the care is less coordinated than at a doctor’s private practice. Some patients see a different resident each visit and there is no on-call service for after-hours problems, Kotelchuck said.

Some hospitals limit the number of Medicaid plans they accept or the services provided to those with Medicaid. Memorial Sloan-Kettering Cancer Center in New York takes just three of the more than a dozen Medicaid plans in the state. The only Medicaid patients that the Mayo Clinic’s facilities in Arizona will accept are those for transplants and adult congenital heart patients, as well as children needing a bone marrow or liver transplant.

Doctors say they often can’t afford to take too many Medicaid patients because of the low reimbursements, especially if they are in private practice rather than being paid a salary by a hospital, said Dale Blasier, chairman of the American Academy of Orthopedic Surgeons’ coding, coverage and reimbursement committee. About 40 percent of orthopedic surgeons nationwide aren’t taking new Medicaid patients, according to the study in Health Affairs.

More Costs

“As I talk to people in private practice, it often costs more to see a Medicaid patient for a visit than what the reimbursement pays,” said Blasier, an orthopedist at Arkansas Children’s Hospital in Little Rock. “It is the bottom of the barrel. No one pays worse than Medicaid.”

There can also be added costs because of additional paperwork, delays in getting paid, and services the patient needs that aren’t covered, Blasier said.

Obama’s health law tries to entice some doctors to treat Medicaid patients by raising the payments to family physicians, internists and pediatricians for primary care services to the same level as Medicare until 2014. Many doctors are skeptical those payments will remain at the higher levels for more than two years, making them hesitant to start taking new Medicaid patients, said Sreckovich of Chicago-based Navigant.

Greater Share

That leaves federally subsidized community health centers, like St. John’s in Los Angeles, to take the brunt of the new patients. More than 1 million uninsured people in California are expected to join Medicaid starting next year. While those people are now getting some care at emergency rooms and free clinics, they are expected to start seeking even more services once they have insurance, said Jim Mangia, St. John’s chief executive officer.

At St. John’s, Mangia estimates a 40 percent increase in the number of patient visits to his centers next year. That is on top of the more than 30 percent jump they’ve seen this year after California started expanding insurance to the poor and his centers increased capacity, he said.

St. John’s has received federal funding to help open two new specialty care centers, built four new school-based clinics, and expanded its headquarters and facilities in Compton, California. It has hired a consultant to suggest ways to improve work flow so more patients can be seen in less time, getting wait times down to less than 40 minutes compared with several hours.

Still, the center isn’t sure it will be able to recruit enough doctors, nurses and physician assistants to meet the demand. The center’s website has 16 job openings for doctors, nurses, and administrative positions.

Physician Churning

“The worry I have is the churning of physicians and the difficulty of finding physicians and how to deal with the burnout because it is such a fast-pace, high-acuity environment,” Mangia said. “You need a whole department of people where all they do is constantly recruit but that is a huge expense.”

Health centers in New Jersey are also bracing for an onslaught of new patients and struggling to find enough doctors. There, about 300,000 uninsured adults are expected to sign up for Medicaid by 2016 under the expansion, many of them single males who have gone years without insurance and have chronic conditions that will need a lot of care, said Grant-Davis of the primary care association.

“We don’t expect it to be a healthy population that will be showing up,” she said. “We expected them to have some complicated needs.”

‘Chronic Asthma’

The clinics she represents have been hiring doctors, nurses and administrative workers and trying to expand hours to meet the demand. They currently have openings for primary care doctors, bilingual staff, nurses and medical assistants. Still, there is only so much they can do when patients have a complex condition that requires more advanced care from a specialist.

“Most of our patients have chronic asthma, diabetes, hypertension and you can manage that, but sooner or later you may need to bring in specialists,” she said. “That gets very challenging to find.”

To contact the reporter on this story: Shannon Pettypiece in New York at spettypiece@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net


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