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Medicaid Co-Pays Are A Poor Tax

Commentary: Last Wednesday, Human Services Secretary Brent Earnest informed lawmakers the state is seeking federal authority to charge co-payments along with other fees to patients who rely on Medicaid for access to health care. Medicaid is funded jointly by state and federal governments. Federal law limits the states' ability to implement cost-sharing, but states may institute co-payments for emergency department visits that are ultimately ruled "non-emergent." In theory, a financial disincentive is seen as a way to reduce dependency on emergency departments, especially by "super-utilizers," those who report to emergency rooms more frequently. Patients in "extreme poverty" would be exempt by federal statute, and the state also pledged to exempt children, pregnant women, and indigenous peoples.


It is not shocking to see New Mexico go this route, following the example of other states. Insuring some 880,000 residents, New Mexico has one of the highest Medicaid enrollment rates in the country. The state is experiencing severe budget troubles, due to our economy being so dependent on the oil and gas industry, and yet Earnest is about to ask the legislature for an 11.4 percent increase for Medicaid funding in the next budget year. Poverty is expensive for the state as well for the individuals living under deprivation.


Nonetheless, instituting co-payments without expanding access to primary care is a policy that doesn't achieve its goal, and amounts to a regressive tax on the poor.


Emergency Department co-payments were authorized by the United States Congress under the Deficit Reduction Act of 2005, but studies indicate they don't solve the problem: the strain on emergency departments and its costs remain high.  Patients seeking medical care in the emergency department are generally there for good reason. In the National Hospital Ambulatory Medical Care Survey for 2011, only 8 percent of ER visits were found to be non-urgent. The rate among Medicaid users was higher (though still just under 10 percent), and the primary reasons for this are economic.  Medicaid patients rely on emergency departments more than privately insured patients because they have less access to primary care physicians or appropriate care settings, making the emergency department a clinic of first and last resort. There is a shortage of primary care physicians who take Medicaid, especially in rural areas. Lack of access to primary care means more people put off medical care until there is an emergency.   


Our market-based ideology about medical care is not only uneconomical; it is, more crucially, inhumane. Co-payments do not reduce use of emergency departments, but they do encourage people to delay health care or view it as a gamble. Is it right that a 70-year old man experiencing chest pain should think twice about visiting the emergency room, in case it turns out he is experiencing severe heartburn and subject to a co-payment he cannot afford? How shall we assess the moral condition of a developed nation, a superpower, that regards medical care as a luxury item better deserved by those with more money?


The Centers for Medicare and Medicaid Services has published recommendations for policies that actually reduce the strain on emergency departments, such as increasing access to primary care facilities and preventative health, special facilities and interventions targeting the "super-utilizers," and investing serious resources into behavior health and substance abuse treatment.  


Where these solutions have been implemented with the backing of resources, they have been effective. Relying only on co-payments does not solve the problem, does not yield significant cost savings, and succeeds only in inflicting further hardship on those in poverty. 


Algernon D'Ammassa writes the "Desert Sage" column for the Deming Headlight and Sun News papers. Write to him at DesertSageMail@gmail.com.