Are we on the eve of a great healthcare migration?
There have been several intra-migrations in U.S. history. I suspect another one is coming, and that hospitals and other providers will have to be especially prepared for it.
Virtually all of these migrations have been financially motivated. The first one was comprised of pioneers heading out West before and after the Civil War. In the years after World War One, a large number of African-Americans left the South to find better jobs and less discrimination in northern industrial cities such as Detroit and Chicago. During the Dust Bowl years of the Great Depression, rural landowners from Oklahoma, Kansas and Texas piled into farming towns in California.
Sign up for our FREE newsletter for more news like this sent to your inbox!The next migration, were it to happen, also will have financial motivations. But access to healthcare will be the primary driver.
Healthcare has become an enormous personal financial issue in the United States. Medical bills due to lack of insurance or being underinsured is the leading cause of bankruptcy filings by far.
Moreover, the number of Americans in that vulnerable position has grown dramatically. Roughly 84 million Americans were uninsured or underinsured for all or part of 2012, according to the Commonwealth Fund’s recent report. That’s almost 30 percent of the entire population, and a figure that is up nearly 40 percent from a decade ago. Forty million of those people would qualify for Medicaid coverage under the relaxed income requirements contained in the Affordable Care Act.
There are also tens of millions of Americans who have chronic conditions such as diabetes and asthma who currently cannot afford to keep them in check.
And a number of states have signaled they do not want to ease the burdens their residents face in this area–indirectly by not building exchanges where they can purchase insurance, and directly by refusing to accept federal dollars to expand their Medicaid programs.
Indeed, the recent actions by the Florida legislature all but shout to its younger and poorer residents “we don’t want you here.” What else to make of a proposal recently approved by the Florida House of Representatives that would enroll little more than 100,000 more low-income people who are disabled or have children into high-deductible health plans they almost certainly won’t be able to afford?
And that’s one of the more generous proposals in the anti-ACA states. Oklahoma and Texas–where 24 percent and 33 percent of the residents lack insurance, respectively–likely won’t do anything to expand Medicaid even a speck.
I suspect this is going to drive many people to move to states like California, New York and elsewhere that are opting into Medicaid expansion under the ACA provisions. That likely will include many who would qualify to receive generous tax subsidies to purchase coverage on the exchange but are on the cusp of Medicaid eligibility. The notion that a cutback in job hours or any other modest drop in income would mean losing one’s insurance–particularly those with young children–is likely galling enough to make the trip.
The kind of jobs in that income bracket–part-time or service work–is, while not abundant these days, practically interchangeable by state.
Hospitals in those states opting fully into the ACA will be treating more insured patients, but that doesn’t necessarily mean they won’t be losing money on the deal. California and New York, for example, have among the lowest Medicaid payment rates for providers in the country.
It’s going to be up to hospitals in the ACA-all-in states to help enroll these new migrants into Medicaid if they enter their emergency rooms–as well as get them into better-paying commercial plans should their incomes bump up to that level. They also will have to lobby their state legislatures and the feds to bump up the Medicaid payment rates, and shout loudly when commercial insurers hint they’re going to jack up rates by double digits.
This migration won’t be as big or history-changing as the South-North shift–I suspect some of those states will see the economic advantages of relenting on their hard-line policies and do so within three to five years. However, it will likely be at least the size of the Dust Bowl migration, if not larger. It will be interesting to see how it develops. – Ron (@FierceHealth)
Read more: Are we on the eve of a great healthcare migration? – FierceHealthFinance – Health Finance, Healthcare Finance http://www.fiercehealthfinance.com/story/are-we-eve-great-healthcare-migration/2013-04-30#ixzz2WVBHHhv4
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