During the full-court press to pass Obamacare, its advocates, including the president, argued that providing medical insurance coverage to the poor would help bring down health care costs. The trendy jargon at the time, seldom heard now, was that it would "bend the cost curve."
But according to a new study, providing Medicaid to uninsured individuals actually increases their visits to costly hospital emergency rooms by 40 percent - and doesn't improve their overall health.
That revealing information about Oregon's multi-year experiment in Medicaid expansion was published Thursday in Science magazine.
The research offers additional evidence supporting Gov. Nikki Haley's decision to keep South Carolina out of the national expansion of Medicaid under the Patient Protection and Affordable Care Act.
President Barack Obama made the case for Medicaid expansion in 2009, telling The Washington Post, "It's important for us to bend the cost curve, separate and apart from coverage issues, just because the system we have right now is unsustainable and hugely inefficient and uncompetitive."
Indeed, that was the theory behind most of the Affordable Care Act, including the push to enroll more Americans in Medicaid by relaxing eligibility requirements.
But though the U.S. Supreme Court ruled in 2012 that most of Obamacare was constitutional, it struck down the law's requirement that the states join in the Medicaid expansion. Instead, the justices ruled that the states could choose to participate - or not participate - in that process.
An important part of the theory behind the Medicaid expansion was the assumption that the uninsured use emergency rooms mainly because hospitals are required by federal law to treat them whether they can pay for the care or not. ERs, for a variety of reasons, are very costly vendors of non-emergency care for colds, sore throats and other ailments that aren't life threatening.
According to figures compiled by the federal Agency for Health Care Research and Quality and the Annals of Internal Medicine, the average emergency room charges three to five times as much to treat common ailments as the average urgent care center, set up to deal with non-emergency medical needs. Care for a sore throat in an emergency room might cost $525 compared to $94 in an urgent care center.
Obamacare advocates argued that with access to affordable health care, individuals would use more primary care, take better care of themselves, use the costly emergency room option less, and have better overall health.
To test this theory, Oregon in 2008 began an experiment in which low-income adults were randomly given Medicaid coverage, and then later surveyed to gauge the effects on their health and well-being. Assessing the effect of the Oregon Health Insurance Experiment on emergency room use, researchers from the National Bureau of Economic Research, Columbia University, the Harvard School of Public Health, the Massachusetts Institute of Technology and the Providence Portland Medical Center compared emergency room visits by insured and uninsured low-income individuals. They reported in Science that they found those with Medicaid used emergency rooms about 40 percent more often, with most of their visits classified as "non-emergent" and "primary care treatable."
Even more discouraging to the prevailing theories of Obamacare, the researchers found that the Medicaid patients, compared to the uninsured, did not show improved health in tests for medical conditions like hypertension, diabetes and cholesterol that should improve with proper care. The insured felt more peace of mind, however.
It is clear that the Affordable Care Act, and universal health coverage in general, is far from the last word on how to "bend the cost curve" and put the nation's health care costs on a sustainable path.
As for those assurances that the federal government would cover all of South Carolina's costs for Medicaid expansion until 2017, with the state's share of the extra expense incrementally rising to a mere 10 percent in the three years after that, keep this in mind:
That pledge comes from the same president who repeatedly made this Obamacare promise in 2009 and 2010: "If you like your plan, you can keep your plan."
The results of the Oregon experiment suggest that Gov. Haley made the right decision in declining to climb aboard the Medicaid expansion bandwagon. If only the nation had a similar option on Obamacare.