Does Medicaid Help?? Down the Rabbit Hole of Health Policy Debates…

I’ve been spending the last two days trying to wade through the ObamaCare vs Romney-Ryan Medicare debates that have caught like wildfire in the media, and apparently reliable policy evidence is hard to come by. While hunting for said evidence, I accidentally tripped upon a maelstrom of a debate between policy wonks on the value of Medicaid. I reproduce the back and forth below to illustrate (1) what I believe to be an intriguing debate on a controversial and highly relevant government program, and (2) how vitriolic health policy debates in the US have become, even among experts hiding behind veils of civility.

The battle centers on a 2010 University of Virginia study titled “Primary Payer Status Affects Mortality for Major Surgical Operations”, which concluded that patients with Medicaid experienced greater surgical mortality than patients with Medicare or even patients with no insurance at all. In summarizing those findings, Forbes contributor Avik Roy elicits a string of responses from liberal-leaning policy writers. Here is the (extremely paraphrased) play by play:

Austin Frakt (health economics, professor, blogger): I’ve reviewed a string of studies that provides indisputable evidence Medicaid improves health over having no insurance. The UVa study is flawed in that it is only observational, and despite controlling for some confounding factors, cannot take into account unobservable factors that may be biasing the results.

Source: sites/aroy/2011/03/02/why-medicaid-is-a-humanitarian-catastrophe/

Avik Roy: The studies you cite have flaws too. One shows public insurance actually led to higher HIV mortality, three are from the same set of authors including Jonathan Gruber who is an Obamacare croney, and the fifth is irrelevant. Furthermore, they’re all published in economic journals, and economists don’t know jack about health care. Here are three clinical studies I picked out that show Medicaid harms most beneficiaries. Let’s convert Medicaid into a block grant program.

“First off, I want to thank Austin for the heroic effort he made in digging up these studies, and writing about them. Unfortunately, his conclusion—that these studies provide “high-quality evidence” that Medicaid improves outcomes—is not supported by the data they contain. Furthermore, Austin’s claim that “there is no credible evidence that Medicaid results in worse or equivalent health outcomes as being uninsured” is so overwhelmingly false that I can’t believe he actually wrote it.”

Harrold Pollack (professor of health policy) to Roy: Your essay makes no sense. While the UVa study shows that mortality is high among Medicaid patients, it also shows that mortality is higher among Medicare patients than the uninsured. How do you explain that, apart from selection bias? Also, why you hatin’ on my man Gruber?

“Avik Roy is an creative and engaging blogger. So is Austin Frakt. In addition, though, Frakt is a highly-skilled empirical health services researcher. So it’s a bit odd that Roy chooses to mix things up with Austin regarding instrumental variables studies that explore the impact of Medicaid coverage on health outcomes.”

Frakt to Roy: Let me explain Instrumental Variable analysis for you. It’s a vast area of mainstream work among economists, and we use it precisely because you can’t control for everything with something like Medicaid. Medicaid AND Medicare patients faring worse than the uninsured? Sounds like selection bias to me. The authors even acknowledge the possible presence of selection bias from factors such as decreased access to health care, language barriers, level of education, and poor nutrition. BTW the studies I cited are totally valid—the Medicaid-leads-to-higher-HIV-mortality figure is erroneous. I contacted the authors myself to confirm.

“Kudos to the authors for acknowledging the limitations of their study. That the results have been repeated elsewhere without such disclaimers is a disservice to science.”

Roy responds: Hey Harrold, I’m not just a blogger, I’m a professional clinical trial evaluator. (Technically, according to his LinkedIn page his current job is “Health Care Policy Advisory for Romney for President”.) Your objection of correlation-not-causation is so overrated. Do you realize that many of the so-called confounding factors you mention are actually caused by Medicaid? And Austin, I’ve devoted not one but three responses to your criticisms. The UVa authors might have admitted potential limitations, but they also asserted that their analyses “proved resilient to the presence of a potentially unmeasured confounder,” which your selective quoting failed to note. BTW let’s turn Medicaid into a block grant program.

“Those who favor empiricism and experimentation should join me in calling for conversion of Medicaid into a block-grant program, whereby the federal government gives the states free rein to compare market-oriented and socialized approaches to Medicaid. Most PPACA advocates are curiously silent on this issue, many arguing instead that the solution to Medicaid’s woes is to preserve the program’s existing architecture, and spend more money: an intellectually indolent suggestion, and a wildly unrealistic one in the present fiscal climate.”

And the debate continues. Scott Gottlieb and Peter Suderman express support for Roy’s view. Jonathan Cohn and Aaron Carroll defend Pollack and Frakt. And it seems the jury is still out on just how much good Medicaid does, and whether it should be improved by more funding, privatization, or conversion to a block grant system.

Update: I’ve come across some evidence that might clarify the debate and suggests that while many commonly-cited Medicaid studies are observational or poor-quality, systematic reviews of high-quality studies and the two natural “randomized experiments” on health insurance in U.S. history may lean in favor of the Medicaid-being-beneficial stance. That’s all I’ll tentatively say for now, since the two previous links are both from Frakt’s blog, and I haven’t had a chance to read through everything in detail yet. The take-away point from all of this is that health policy debate in the U.S. is convoluted and deeply intertwined with politics. Time to go further down the rabbit hole.

The red and blue association with political parties is completely unintentional and does not imply either side is right. Source:

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