Costs, Access, and Utilization Under Medicaid: A Review of the Evidence: Cover Missouri Project: Report 2

Costs, Access, and UtilizationUnder Medicaid: A Review of the EvidenceMISSOURIFOUNDATIONFORHEALTHCover Missouri Project: Report 2 Established in 2000, the Missouri Foundation for Health is dedicated to its mission ofempowering the people of the communities we serve to achieve equal access to qualityhealth services that promote prevention and encourage healthy behaviors. In support of itsmission, the Foundation undertakes policy research to educate the public and decisionmakers on effective health policies that will result in long-term, positive health system changein the state of Missouri. Formulating sound health policies advances the Foundation’s effortsto increase access to high quality, cost-effective preventive and curative care, especially forthe uninsured, underinsured, and underserved in our service region of 84Missouri countiesand the City of St. Louis.The Missouri Foundation for Health does not take responsibility for any analysis, errors, oromissions of fact found in this report.MISSOURIFOUNDATIONFORHEALTHAbout MFH Cover Missouri ProjectPrefaceIn an effort to inform the discussion regarding practical policy options to expand healthcare coverage for the uninsured in Missouri, the Missouri Foundation for Health (MFH)has established the Cover Missouri Project. Under this project, MFH has engaged TheUrban Institute to produce a series of papers which considers strengths andweaknesses of the current health care system in Missouri and explores options fordecreasing the number of uninsured. MFH offers these studies as a means to furtherunderstand and ultimately improve access to health care coverage. Missouri currently faces considerable challenges related to creating an equitable and comprehensive system of health care for all Missourians. In 2005, between635,000 and 707,000Missouri residents were without health insurance. In addition,eligibility cuts and cost-sharing changes to Missouri’s Medicaid program made in2005 increased the number of uninsured. Ultimately, these changes may shift Missourifrom being one of the 12states with the lowest uninsurance rates to being among the12states with the highest rates of uninsurance.Research broadly documents the serious health and financial consequences associatedwith being uninsured. The uninsured live sicker and die younger than those withinsurance. They forego preventive care and seek health care at more advanced stagesof disease. Society then bears these costs through lower productivity, increased ratesof communicable diseases, and higher insurance premiums. Those without healthinsurance often must choose between visiting a doctor and paying for other essentials. This paper, “Costs, Access, and Utilization Under Medicaid: A Review of theEvidence,” represents the second report in the series emerging under the CoverMissouri Project. It compares and contrasts Medicaid to both private insurance andbeing uninsured in terms of a recipient’s access to and use of health care. The paperalso provides an examination of costs under both Medicaid and private insurance.Finally, the paper studies the evidence on whether the growth in Medicaid spending isgreater than observed in the private sector, which helps determine if the growth inMedicaid costs relate directly to the program itself or reflect changes in the overallhealth care system. Leslie ReedVice President for Health PolicyMissouri Foundation for Health About the AuthorsJohn Holahan, PhD,is Director of the Health Policy Center at The Urban Institute. He hasmanaged numerous health research projects in the last 25 years and authored many books andpapers on health policy. His recent work has focused on the Medicaid program, as well as statehealth policy more broadly, and issues of federalism and health. He has published research onthe reasons for the increase in uninsured over the past decade and on the effects of proposalsto expand health insurance coverage on the number of uninsured and the cost to federal andstate governments.Sharon K. Long, PhD,is a Principal Research Associate with the Health Policy Research Centerat The Urban Institute. Her recent publications include studies of the effectiveness of the Medicaidprogram in providing access to care, state efforts to expand insurance coverage, theimplications of the continuing decline in employer-sponsored coverage for low-income workers,and the effects of managed care on disabled adults.About The Urban InstituteThe Urban Institute is a nonprofit nonpartisan policy research and educational organizationestablished to examine the social, economic, and governance problems facing the nation. Itprovides information and analysis to public and private decision makers to help them addressthese challenges and strives to raise citizen understanding of the issues and tradeoffs in policymaking. The Urban Institute works to promote sound social policy and public debate on nation