On June 29, Families USA released a report examining Medicaid cuts outlined under U.S. Rep. Paul Ryan’s (R-WI) $3.5 trillion FY2012 budget proposal, approved by the U.S. House on April 15.  In addition to repealing most provisions of the national health care reform law, the budget would also convert Medicaid into a block grant program beginning in 2013, reducing state payments by 5 percent in 2013, 15 percent in 2014, and 33 percent in 2021.  Based on an economic modeling tool used by the U.S. Department of Commerce to assess the impact of major events on regional economies, Families USA’s analysis finds that the Medicaid cuts would risk a total of 35,210 jobs and $4.2 billion in economic activity.  The report estimates that the cuts would harm program enrollees, reduce business activity, and contribute to job losses.  The report also provides state-level estimates of the impact of each cut on business activity and jobs.

From the report:

Health Affairs has released a study finding that hospitals in areas with robust hospital competition tend to address shortfalls between Medicare payments and projected costs primarily by reducing hospital costs.  Conversely, the authors found that hospitals in areas where hospital care is concentrated among a limited number of providers respond by raising the prices they charge private insurers, in a practice known as “cost shifting”.  The authors argue that their findings necessitate a policy discussion about whether increased provider integration will interfere with the national health care reform law’s goal of reducing Medicare spending, as increased integration could reduce market competition and, in turn, increase the use of cost shifting.

Robinson, James. (2011). Hospitals respond to Medicare payment shortfalls by both shifting costs and cutting them, based on market concentration. Health Affairs, 30 (7): 1265-1271. doi: 10.1377/hlthaff.2011.0220. http://content.healthaffairs.org/content/30/7/1265.abstract

Author: James Robinson.

On July 7, the National Bureau of Economic Research (NBER) published a study examining the impact of providing health coverage to uninsured low-income individuals.  Focusing on the impact on health service utilization, health outcomes, and financial burden, the study examined the effects of a 2008 Oregon Medicaid expansion that used a lottery system to select 10,000 participants to enroll in Medicaid out of a pool of approximately 90,000 applicants.  NBER found that beneficiaries had statistically significantly higher health service utilization and better self reported physical and mental health than the control group, which was comprised of individuals not selected for Medicaid coverage in the lottery.  Additionally, the authors found statistically significantly lower out-of-pocket (OOP) medical spending and medical debt among beneficiaries when compared to the control group.  The study has implications for the impact of the national health care reform law’s Medicaid expansion on uninsured individuals.

Finkelstein, Amy et. al. (2011). The Oregon health insurance experiment: evidence from the first year. National Bureau of Economic Research, (17190). http://www.nber.org/papers/w17190

Authors: Amy Finkelstein, Sarah Taubman, Bill Wright, Mira Bernstein, Jonathan Gruber, Joseph P. Newhouse, Heidi Allen, and Katherine Baicker.

On June 23, the Kaiser Family Foundation (KFF) released a brief examining health coverage challenges facing unemployed individuals and outlining their options for maintaining coverage.  The brief notes that 13.9 million individuals were unemployed in May 2011, of whom 6.2 million had been uninsured for at least six months.  The authors suggest that individuals’ options to maintain health coverage diminish as they remain unemployed for six months or more, highlighting COBRA, public health coverage, and the individual insurance market as options for unemployed individuals to obtain health coverage.  The authors assert that implementation of the national health care reform law will result in a wider range of affordable coverage options for the unemployed.

From the report:

Mathematica Policy Research has released a brief examing managed care opportunities for childless adults under the national health care reform law's Medicaid expansion.  The law explains how the Medicaid expansion will work and who it will make eligible for Medicaid coverage.  The authors also examine opportunities and challenges for managed care under the expansion.

From the report:

Health care reform Medicaid expansion will result in many potential new enrollees for Medicaid MCOs.  High health care needs and costs for low-income childless adults will present significant challenges in terms of outreach, network development, care management, capitated rate setting, and quality monitoring.

Full report: Extending Medicaid Coverage to Low-Income Childless Adults: Opportunities and Cautions for Managed Care Plans (PDF | 149.96 KB)

Mathematica Policy Research.  (2011).  Extending Medicaid coverage to low-income childless adults: opportunities and cautions for managed care plans.  Verdier, J.

The Journal of Health Politics, Policy and Law has published a study examining relative affordability of health coverage premiums under the national health care reform law and the expansion of the Children's Health Insurance Program (CHIP).  The authors compare the cost of covering a family in Illinois, Pennsylvania, and Washingon through a combination of CHIP and employer-sponsored coverage to that of a family obtaining coverage through one of the law's health exchanges. 

Gresenz, C., Laugesen, M., Yesus, A. and Escarce J.  (2011).  Relative affordability of health insurance premiums under CHIP expansion programs and the ACA.  The Journal of Health Politics, Policy and Law, 36 (3): 859-877.  doi: 10.1215/03616878-1407658.  http://jhppl.dukejournals.org/content/early/2011/07/22/03616878-1407658.full.pdf+html

Authors: Carole Gresenz, Miriam Laugensen, Ambeshie, Yesus and Jose Escarce.