Medicaid study proves there ain't no free lunch

Today's news brings us an example of the science fiction giant Robert Heinlein's principle of TANSTAAFL, otherwise known as "there ain't no such thing as a free lunch." It points up that you can't simply screen needy people out of having access to medical care and act as though you're saving money.

A new study, as reported in The New York Times, has concluded that people who have inconsistent Medicaid coverage are more than three times likelier than those with ongoing coverage to be hospitalized for an illness that could have been managed outside a hospital.

The study, which comes from the Annals of Internal Medicine, found that 62 percent of Medicaid recipients saw a gap in coverage during a five-year period, and that those with gaps were far more likely to be hospitalized for diabetes, asthma and other chronic conditions.

So, why did patients face these gaps? Apparently, in California (where the study data was gathered), patients must frequently prove their eligibility for the program. They lose their benefits if they don't. And since re-proving eligibility can be a challenge for some of this population, we're talking a lot of missing coverage here.

Of course, California officials defend the practice as a necessary one to prevent fraud and abuse of the system. But researchers note that under this system, Medicaid ultimately ends up paying for these patients in the long run. (Oh, and there's the small matter of hospitals and doctors absorbing the costs of these unnecessarily uninsured patients...)

Sure, state officials like to think that they're protecting taxpayer dollars, and that's a good thing overall. But in this case, it seems that the money they hope to save by screening out fraud simply shifts costs elsewhere--and multiplies it. If that's a free lunch, then please spare me the free dinner. - Anne