Big News From Oregon--Not All of It Good

There is study in progress with a randomized control group design—the gold standard of evaluation research—to evaluate the effects of Medicaid expansion in Oregon. The second wave of results from that study were published yesterday. To summarize briefly, Oregon wanted to expand Medicaid but didn't have enough money. They invited anyone who was eligible to apply, and 90,000 people applied. They then randomly selected 10,000 of them to receive Medicaid, while the others became eligible for the control group. The first wave of results, with about 6000 adults in each group, showed that the Medicaid recipients were more likely to rate themselves in “good” or “excellent” health, were less likely to report a recent decline in their health, had more doctor and hospital visits, more preventive care, and fewer unpaid medical bills.

Unfortunately, the second wave study, published in the New England Journal of Medicine, is gated, so I am relying on the abstract and a summary by Aaron Carroll and Austin Frakt in The Incidental Economist blog.

The corporate media are spinning the second wave study as showing Medicaid expansion to be a failure. For example the New York Times says:

It found that those who gained Medicaid coverage spent more on health care, making more visits to doctors and trips to the hospital. But the study suggests that Medicaid coverage did not make those adults much healthier, at least within the time frame of the research . . .

Later the article notes that Medicaid expansion under the Affordable Care Act will be costly. “Health economists anticipate that new enrollees to the Medicaid program will swell the country's health spending costs by hundreds of billions of dollars over time,” it warns. If you go online and check the comments following any article about the study, you'll find that it has unleashed a torrent of criticism from the political right claiming that providing health care for the poor is a waste of money. The study is certain to be used by Republicans such as Pennsylvania Governor Tom Corbett to justify their opposition to Medicaid expansion.

So what does the second wave study actually show? First, the bad news. The three objective indicators of physical health, blood pressure, cholesterol and blood sugar level, were all lower in the Medicaid group than the control group, but the differences were not statistically significant. Here are the data. (HDL is “good” cholesterol, so the fact that there are fewer people with low HDL cholesterol in the Medicaid group is a good outcome. High hemoglobin A1c is high blood sugar.)

Now the good news. Medicaid reduced the incidence of depression by 30%, which was statistically significant. It also significantly increased preventive care, including a 50% increase in cholesterol monitoring, a doubling of mammograms, and an increased likelihood of being diagnosed with diabetes.

Finally, the economic news. Health care spending was 35% higher in the Medicaid group. Of course, Medicaid practically eliminates catastrophic medical costs. As a result, the Medicaid recipients were significantly less likely to report borrowing money or skipping other bills in order to pay medical expenses.

There are several reasons we should not accept the conservative rush to judgment that this study shows that Medicaid is not helpful.

• Medicaid recipients were healthier on all three measures of physical health. The problem is that the differences were not statistically significant. There are several reasons why that might be the case, but the most likely is that the sample sizes were too small to detect the effect. The authors state:
  
  
  [O]ur power to detect changes in health was limited by the relatively small numbers of patients with these conditions; indeed, the only condition in which we detected improvements was depression, which was by far the most prevalent of the four conditions examined. The 95% confidence intervals for many of the estimates of effects on individual physical health were wide enough to include changes that would be considered clinically significant . . .
  
  
• These data were collected only two years after the program began. The significant differences in preventive care suggest that greater differences in health might emerge in later waves of the study.
  
  
• Mental health is also health, and significant differences in depression should not be dismissed as unimportant. Financial hardship also matters, and its absence may be related to the lower incidence of depression in the Medicaid group.
  
  
• There is no comparable study of the health effects of private health insurance, so these data should not be used to infer that Medicaid is any more expensive or less effective than private insurance.
  
  

Let's do a thought experiment. Suppose you had a private health insurance policy, researchers did a study to evaluate its health effects that was comparable in size, duration and design to the Oregon study, and obtained identical results. That is, the policy holders' health was better, but not significantly better than people without insurance. Would you cancel your policy? One of the reasons people buy health insurance may be that they think it will make them healthier, but it is my guess that the primary reason people in this country buy health insurance is to guard against the financial consequences of catastrophic illness.

You may also be interested in reading:

Tom Corbett to PA's Working Poor: “Drop Dead!” Part 1. Medicaid improves Health and Saves Lives.

Tom Corbett to PA's Working Poor: “Drop Dead!” Part 3. What Medicaid Expansion Would Mean to Pennsylvania

Medicaid Expansion Update