The Oregon Medicaid study: What does it tell us?

The Oregon Medicaid study: What does it tell us?

Recently, an article by Kate Baicker and colleagues came out in the New England Journal of Medicine. Almost immediately, the article received widespread attention in the media where headlines claimed that giving people Medicaid coverage doesn’t improve their health. This is not exactly what the article said, but most journalists aren’t scientists, so we should cut them a bit of slack. But, before I give you my interpretation of the study’s findings, let me provide you with some background.

The state of Oregon has a waiver to provide Medicaid coverage to a group of low-income adults that would not otherwise be eligible for Medicaid under traditional law. They call this the Oregon Health Plan Standard. The problem is, states are required to balance their budgets annually, and there is more demand for this Medicaid program than there is money in the state budget to meet that demand. So, the state created a waiting list, and in 2008, the state had enough money to expand the Medicaid program slightly. To be fair, they held a lottery among the nearly 90,000 waitlisted individuals, and some 30,000 of them won the right to enroll in Medicaid. The reason that’s important is that the lottery introduces a random selection process that is extremely valuable when conducting research. I’ll spare you the additional details, because if you’re the kind of person who needs to know them, you’ll go read the NEJM article for yourself.

Two years after the lottery, the study authors interviewed both the group that won the lottery and a “control” group that didn’t win the lottery. According to the authors, they asked about “health care, health status, and insurance coverage; an inventory of medications; and performance on anthropometric and blood pressure measurements.” They assessed both depression and self-reported health-related quality of life. The goal, in short, was to see what difference obtaining Medicaid coverage makes compared to being uninsured.

The story making headlines is that people didn’t get healthier by gaining Medicaid coverage. This is because there were no statistically significant improvements in blood pressure, cholesterol levels, or controlled diabetes. Indeed, that is one thing the study found, but that’s not all. They also found that people who gained Medicaid coverage were more likely to have their diabetes diagnosed, which is the first step in getting it treated. Additionally, they found that those with Medicaid coverage were less depressed, reported a better quality of life, used more health care, and were far less likely to encounter financial hardship because of health care.

Since a central component of the Affordable Care Act is the expansion of Medicaid to a population similar to that studied in this Oregon expansion, these findings are being viewed as evidence that expanding Medicaid will just mean more money spent on increased use of health care without anything to show for it. The flaw in that thinking comes from the fact that insurance coverage is a necessary, but not sufficient, cause of improvements in health outcomes.

In other words, just giving people Medicaid coverage isn’t going to fix everything. We still need to make sure that they have access to a doctor, have the ability to make and keep their appointments, understand and comply with their doctor’s orders, and help them navigate the complexities of the health care system. We also need to make sure that the treatments they are provided are effective. This is where other components of health reform are poised to play a major role. Accountable care organizations and patient-centered medical homes are designed to focus on integrated, high-quality care that puts the patient first and shifts health care providers’ focus from volume to value.

The Patient-Centered Outcomes Research Institute (PCORI), headed by Dr. Joe Selby, is funding comparative effectiveness research that seeks to identify what works and what doesn’t. But this study by Baicker and colleagues provides extremely strong evidence that health insurance insulates people from the financial risk of illness, and that seems to give them peace of mind that makes them report a better quality of life–even if their blood pressure hasn’t yet been lowered.

So, to conclude that Medicaid doesn’t do what it is supposed to isn’t true. It does precisely what it is supposed to. We just have to make sure that all of the other components of a high-performance health care system are in place and doing what they are supposed to. When that happens, the health care outcomes we seek will follow.

Brad Wright is an assistant professor of health management and policy who blogs at Wright on Health.

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  • icecoldchickenwings

    They don’t get healthier They feel less depressed. This was not a diagnosis of depression they just feel less depressed.

    More people were actually diagnosed diabetes but the control wasn’t any better. Meaning the people who didn’t know they had diabetes had made no lifestyle or medication changes had the same level of control and you think this is somehow a success?

    • Kim


  • ninguem

    Actually practicing in Oregon, I will say categorically that the Oregon Health Plan is so horrible to work with, that I have dropped all my OHP. I will only accept OHP pediatrics.

    I have patients misrepresent their coverage, actually lying that they are uninsured. I get it all the time.

    What they’re trying to do, is get into my practice. They perceive my practice as high quality, compared to the big box competition.

    Thing is, I will check the OHP database. If the person shows up as OHP covered, I cancel the new patient appointment.

    I will see that patient if uninsured, but not if OHP.

    OHP has a “lookback”, about six months or so.

    So the uninsured patient, I do my best to cut breaks with the fee and all that.

    Then, five months and a couple weeks later, that “uninsured” patient who really has OHP, calls, says “by the way I have OHP”, requiring me to refund everything billed, and then bill OHP, which more often than not denies payment completely, or if they pay, it’s 20% of the fee that I have already reduced to help out an uninsured patient.

    • Margalit Gur-Arie

      So why are we surprised that this entire exercise in futility is not having any effects on outcomes?

      • ninguem

        Oh, they can get healthcare.

        Just not me.

        If we’re all supposed to be of equal quality, if we’re all completely interchangeable parts, it should not make any difference, should it?

  • Margalit Gur-Arie

    Fine, I can see how this abject dehumanization of people forced to submit themselves to a lottery for obtaining what they think might be medical services, serves as a financial instrument against possible bankruptcy and the associated anxiety.
    But what is it that Oregon does to actually provide quality medical care to its poor residents? Since we are all speculating, perhaps one of the reasons no improvements were observed is that whatever was measured as increased utilization, was utilization of poor quality services, which is all Medicaid members can expect (see ninguem’s earlier comment).

    • ninguem

      Poor quality services?

      Are you saying there’s actually a difference in quality between practitioners?

      We’re all supposed to be interchangeable parts.

      • Margalit Gur-Arie

        You know me better than that… :-)

        • nunguem

          The instrument against bankruptcy…….

          I had a lady who walked into my office with a neurological deficit and visual field cut that strongly suggested brain tumor. Sure enough, glioblastoma multiforme.

          No insurance. She was on the operating table in about two days, and Oregon Medicaid was somehow capable of getting her on Medicaid retroactive to the beginning of that month.

          On the other hand. Here’s another one I had. Medicaid recipient with a narcotic abuse history that wants to get clean. Actually, the patient’s father was willing to pay me directly for addiction services.

          That office visit for a drug abuser will pay about thirty bucks, Medicaid.

          No way.

          So, I won’t take it.

          But father wants to pay directly.

          Medicaid won’t let me do it. Well, they claim they can, with a process that is so cumbersome, and fraught with danger if I do it wrong, that I won’t bother.

          So……fine. Go to the county hospital, which will, in fact, get a far higher payment than I would, from Medicaid, for the same services.

          Their biggest fear is that a dollar gets into the hands of a physician who is actually providing legitimate medical services.

          That’s a dollar less for an administrator.

        • ninguem

          Margalit, I had a medical student on a rural rotation, he wrote a study on the concept you allude to.

          People in my area have insurance, but no one will take it (OHP).

          The only ones taking it are the marginal practitioners, and the hospital running big box clinics staffed with nurse-practitioners, little if any physician input, and even for the nurses it’s a revolving door.

          The student was insightful enough to learn that health INSURANCE does not equal health CARE.

          • Margalit Gur-Arie

            I completely agree. Medicaid has deteriorated to something that cannot be included in the term insurance as widely applied to other venues.
            As long as we are OK experimenting with people, I would suggest two other experiments: a) have a lottery to give some of these uninsured a regular Blue Cross Blue Shield insurance card and then compare outcomes to the still uninsured, and b) have Blue Cross Blue Shield shrink payments to its provider network to match Medicaid payments (for a small number of experiment subjects) and compare their outcomes to rest.
            My hypothesis would be that insurance that does not pay for cost of services, correlates with worse outcomes for the insured, no matter how much utilization of cheap venues occurs, with a corollary that addresses the interchangeability of parts rather nicely.

  • Guest

    If giving people “free” taxpayer funded health insurance has no impact on their actual, erm, health, then why bother? Why not just give everyone free money to spend how they like? Except then you couldn’t justify that as “health insurance” I guess. It’s pure wealth distribution. Take from the people who’ve earnt it and give it to the people who haven’t, to make them happy.

  • NormRx

    You posters that are condemning the Oregon Health Plan are missing the point. Even though the recipients health is the same as the non recipients, the politicians “FEEL” better and isn’t that what is important?

  • Guest

    Giving people free medical care, paid for by someone else, didn’t help their health outcomes, but made them happier.

    So, robbing Peter to pay Paul makes Paul happy. Who would’ve guessed THAT?

  • Nils

    “Medicaid did precisely what is was supposed to do”

    Obama said that giving an additional 17 million Americans free Medicaid would both improve their health, and save our health budget money in the long run.

    These people in Oregon, when given free Medicaid, used more medical services (more $$), and it didn’t improve their health.

  • Jim Jaffe

    as is usual with our political discourse, people found that their pre-existing views were confirmed by the Oregon study, which seems fairly preliminary to me. It is interesting, may be important and is certainly not dispositive, Anyone who tries to draw broader lessons from it is probably at best on the cusp of rhetorical malpractice. So why can’t we simply let it be? No action is required or appropriate in any event. Over time we’ll know more and this study will fit into a broader, more useful pattern.

    • SBornfeld

      You remember what Lord Keynes said about the “long run”…

    • Trev

      “No action is required or appropriate in any event.”

      By this do you mean that we should keep the status quo and not change anything (ie not vastly expand Medicaid as Obama wants to do)?

  • Dorothygreen

    If we adopted a model of a health care system (we don’t have a system we have a hodgepodge) like Switzerland, taking the profit out of essential services and let those who can afford and want to pay higher insurance premiums for physician choice, private rooms in hospitals, alternative medicine, brand name drugs, and other supplemental services, we would not be having these ridiculous studies that cost money at the expense of patient care. There would not be a Medicaid. Government subsidies would go to the poor to buy insurance – not free care – the recipients would have to choose their insurance like everyone else. . It would be mandatory for all even if qualified for 100% subsidy. Every one has some responsibility here and someone to answer to regarding their use of services. The government negotiates essential care prices for everyone with all the players up front. Then doctors then take care of patients. Hospitals build and renew from the supplement premium money. Insurance companies do all the administration and make their profit from the supplement insurance.

    But this is not enough. Because unhealthy food is cheaper than healthy food in the US we are the sickest rich country in the world – hence driving health care costs. Subsidies to corn and soy used for animal feed (unnatural) and HFCS – cheap sugar). Pervasive marketing of low to no nutrient foods and high sugar beverages (made with subsidy money), allowing the use of food stamps for soda, chips because they are regarded as “food”. Vegetables and fruits labels as “specialty crops” so they don’t get subsidies. The amount of money both the medical industrial complex players and BIG AG and Big food put into lobbying is outrageous.

    All this is Crony Capitalism at its ugliest.

    We gotta change both. It is not seniors (aka Medicare) who are the problem. It is the BIGS – Bullies Invested in Government.

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