By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    risky jobs for lungs
    These Are the 10 Riskiest Jobs for Your Lungs
    November 15, 2022
    house cleaning tips to stay healthy this year
    Crucial House Cleaning Tips to Stay Healthy This Winter
    December 20, 2022
    Treating accidental Spinal Cord Injuries with Technology
    Treating Accidental Spinal Cord Injuries with Technology
    February 28, 2023
    Latest News
    5 Steps to a Promising Career as a Healthcare Administrator
    August 3, 2025
    Why Custom Telemedicine Apps Outperform Off‑the‑Shelf Solutions
    July 20, 2025
    How Probate Planning Shapes the Future of Your Estate and Family Care
    July 17, 2025
    Beyond Nutrition: Everyday Foods That Support Whole-Body Health
    June 15, 2025
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    The Flu Vaccine: Pros and Cons
    February 10, 2012
    SCOTUS Rules on a Couple of Important Pharma Cases
    June 27, 2011
    Weekend Athlete: Should You Have Sex Friday Night?
    March 8, 2012
    Latest News
    How IT and Marketing Teams Can Collaborate to Protect Patient Trust
    July 17, 2025
    How Health Choices and Legal Actions Intersect After an Injury
    July 17, 2025
    How communities and healthcare providers can address slip and fall injuries with legal awareness
    July 17, 2025
    Let Your Lawyer Handle the Work Before You Pay Medical Costs
    July 6, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Medicaid for All?
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Business > Finance > Medicaid for All?
BusinessFinanceHealth ReformHospital AdministrationPolicy & LawPublic Health

Medicaid for All?

DavidEWilliams
DavidEWilliams
Share
4 Min Read
Medicaid Financial Strain
SHARE

“As More Join Medicaid, Health Systems Feel Strain.” That’s the striking and counterintuitive headline on the front page of the Wall Street Journal. The Affordable Care Act is injecting billions upon billions of dollars to provide Medicaid to previously uninsured people. More money should help healthcare providers’ finances, not hurt them. So what’s going on?

“As More Join Medicaid, Health Systems Feel Strain.” That’s the striking and counterintuitive headline on the front page of the Wall Street Journal. The Affordable Care Act is injecting billions upon billions of dollars to provide Medicaid to previously uninsured people. More money should help healthcare providers’ finances, not hurt them. So what’s going on?

Medicaid Financial StrainTo summarize, Medicaid reimburses for services at only about half the rate of what commercial health plans pay. A doctor in the article receives just $80 to see a Medicaid patient compared to $160 for a commercial patient. That’s typical.

If all providers had the same mix of patients, this wouldn’t be such a problem. Well reimbursed commercial patients would make up for poorly paid Medicaid patients. But in today’s world, that’s not how it works. Some health systems concentrate their resources in wealthy communities with lots of commercial patients. Other providers end up with a much higher share of Medicaid patients and enter a vicious cycle that depresses their earnings, makes it hard for them to compete, and leads eventually to financial distress. To make matters worse, some of these “Medicaid” hospitals receive lower rates from commercial plans than fellow hospitals who avoid Medicaid. This is the scenario we face in Massachusetts (see Healthcare Inequality in Massachusetts: Breaking the Vicious Cycle) and elsewhere.

More Read

EHR
The Irony of a Paper TOC Document in an EHR
Implementing Data To Increase Employee Engagement In Healthcare
Report: Obtaining Healthcare Coverage Still Difficult Amid Reform
What If Shared Decision Making Costs More?
Are You Ready for Medicare Part E?

Still, I don’t accept the Journal’s implicit conclusion that the Medicaid expansion is bad for hospitals and physicians overall. For any given patient, a provider would much rather get reimbursed by Medicaid than try to collect from an uninsured patient. And since the US spends double per person what other rich countries spend on healthcare, even stingy Medicaid budgets should suffice.

It’s notable that the Journal article says next to nothing about solutions to the problem. All of the examples they cite assume a fee-for-service system. The very first example – Medicaid paying for robotic surgery for a patient – reminds me of the US system’s penchant for high-tech interventions that are expensive but not necessarily better.

Solutions are at hand, if we would be bold enough to embrace them:

  • Reduce disparities in reimbursement rates. Is there a defensible rationale for paying different rates for Medicare and Medicaid beneficiaries? For that matter, why should commercial plans pay a different rate?
  • Consider payer mix when setting reimbursement rates. If we’re stuck with differential rates between Medicaid and commercial –which we probably are– we should at least not penalize providers who take care of a lot of Medicaid patients. Their commercial and/or Medicaid rates should be adjusted so they don’t have to turn away Medicaid patients to survive.
  • Shift to risk-based payment models. Fee-for-service is wasteful and provides incentives for volume and high acuity care rather than value. Why not encourage the use of Medicaid Accountable Care Organizations and other risk-bearing approaches that give providers responsibility for costs and quality?

The sooner we have a serious discussion about Medicaid policy in this country the better.

Medicaid / shutterstock

TAGGED:Medicaid
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

technology in medical research
The Tools Helping Medical Researchers See the Full Picture
News Technology
August 3, 2025
5 Steps to a Promising Career as a Healthcare Administrator
5 Steps to a Promising Career as a Healthcare Administrator
Health
July 31, 2025
holistic dental
Holistic Dentist Services Are Natural and Safe
Dental health Specialties
July 28, 2025
botox certification
Help Improve People’s Skin Health Via Botox Certification
Skin Specialties
July 22, 2025

You Might also Like

5 Ways Health Providers Can Help Reduce Patient Stress Without Drugs

July 27, 2016

Aid Cuts to Middle-Income Countries Worsen Global Poverty and Ill-Health

January 10, 2012

Medicaid P4P

March 7, 2011
health policy
Health ReformHospital AdministrationPolicy & Law

Does the Doctor Need a Boss?

August 6, 2013
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?