We keep hearing about the 10 million people who obtained new health insurance via Obamacare exchanges this year. The popular belief is that simply providing insurance to all those that did not have it prior to 2012 somehow translates into better health care, and reduce costs. It helps to remember that “costs and over-utilization” of expensive health care services were some of the main reasons given in 2009 to justify this monstrous piece of legislation. So what are the newly-insured doing?
We now have the first set of data showing how the newly insured are using their taxpayer-subsidized insurance. The WSJ reports that hospital ER visits, back surgeries and other high-cost services have increased substantially. A report from the Robert Wood Johnson Foundation shows no increase in primary care or preventative visits.
Various explanations are given for this phenomenon. Didn’t we see the exact same expensive pattern before “health care reform”? The only difference now is that these folks showing up in the ER have insurance cards, paid for by the hard-working taxpayers. The best explanation I read comes from management consultant, Owen Dahl “Just because they have insurance doesn’t mean they would change their behavior” in Physicians Practice magazine.
Another explanation is the narrow-narrow networks, which in some states, includes only 20% of conventional roster of physicians, and relatively low payment rates for physician services among exchange plans. This means folks have insurance cards, but no doctor.
For now, nothing seems to have changed as far as lack of primary care and over-utilization of high-cost services. If there’s any logic left in the health insurance market, this should mean insurance premium rates continue to shoot up. But it is an election year. Perhaps we are looking at Troubled Health-Insurance Relief Program (THIRP) in 2015! How much can productive tax-payers be burdened? John Galt?
Arvind Cavale MD is an endocrinologist in private practice, you can follow Dr. Cavale on Twitter @endodocPA.