Medicaid And The Limits of State Health Reform

Medicaid And The Limits of State Health Reform

Michael S. Sparer
Copyright Date: 1996
Published by: Temple University Press
Pages: 248
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  • Book Info
    Medicaid And The Limits of State Health Reform
    Book Description:

    With the defeat of national health reform, many liberals have looked to the states as the source of health policy innovation. At the same time, many in the new Republican majority and several governors also support increased state control. In contrast, Michael S. Sparer convincingly argues that states by themselves can neither satisfy the liberal hope for universal coverage nor the conservative hope for cost containment. He also points to two critical drawbacks to a state-dominated health care system: the variation in coverage among states and the intergovernmental tension that would inevitably accompany such a change.

    Supporting his arguments, Sparer analyzes the contradictions in operations and policies between the New York and California Medicaid programs. For instance, why does New York spend an average of $7,286 on its Medicaid beneficiaries and California an average of $2,801? The answer, the author suggests, is rooted in bureaucratic politics. California officials enjoy significant bureaucratic autonomy, while the system in New York is fragmented, decentralized, and interest-group dominated. The book supports this conclusion by exploring nursing home and home care policy, hospital care policy, and managed care policy in the two states. Sparer's dissection of the consequences of state-based reform make a persuasive case for national health insurance.

    eISBN: 978-1-4399-0509-8
    Subjects: Health Sciences

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. Acknowledgments
    (pp. ix-xii)
  4. 1 The State Role in Health Care Reform: Why Do We Care?
    (pp. 1-13)

    It is by now well known that the United States is the only Western industrialized nation without national health insurance. Following the 1992 presidential elections, however, it seemed that this exceptionalism was about to end. Newly elected President Bill Clinton declared health care reform to be a (very) high domestic priority. Pollsters revealed citizen support for reform. Key interest groups (including health care providers, commercial insurance companies, and much of the business community) voiced support for reform as well. Even leading Republicans generally agreed that there was a “health care crisis” that needed to be addressed:

    In the fall of...

  5. 2 Congress Considers Health Reform
    (pp. 14-30)

    For much of U.S. history, the federal government was only a minor player in the nation’s health care system. During the nineteenth century, for example, federal health care legislation was considered not only unwise but at times even unconstitutional. National health insurance wasn’t even debated until 1912, when former President Theodore Roosevelt, campaigning then as a member of the Progressive political party, urged its adoption. But Roosevelt’s proposal for universal insurance was quickly labeled “un-American” and “socialistic” by doctors, businessmen, and even union officials and was easily defeated. Later initiatives by Franklin Rooseveltl and Harry Truman fared no better.²


  6. 3 Explaining Medicaid Variation
    (pp. 31-65)

    Medicaid, enacted by Congress in 1965, provides governmentfunded health insurance to more than thirty-three million lowincome Americans. Until recently, Medicaid spending, while hardly low, increased at a slower rate than either Medicare or private health insurance.¹ In recent years, however, Medicaid spending has escalated rapidly, growing at a rate far faster than other major payers, increasing from approximately $47 billion in 1987 to $88 billion in 1991 to $131 billion in 1993.² These cost increases pose particular burdens for state and local governments, which paid approximately 48 percent of the 1993 Medicaid bill (around $56 billion). ³ Indeed, Medicaid now...

  7. 4 The Medicaid Programs in New York and California
    (pp. 66-81)

    New York has the nation’s most expensive Medicaid program. Total program expenditures in fiscal year 1993 were around $20 billion, or $7,286 per beneficiary.¹ California’s Medicaid program is also costly, with 1993 expenditures at around $13.5 billion, but the California program spent an average of only $2,801 on each of its beneficiaries, a per-beneficiary spending that ranks forty-eighth among the fifty states.² Put differently, New York’s per beneficiary spending is triple that of California.

    Why does New York spend so much on so few? Why does California spend so little on so many? These are the policy puzzles posed in...

  8. 5 Paying for the Institutionalized Aged: Lessons from Nursing Home Policy
    (pp. 82-101)

    Before the New Deal, there were few institutions for the aged. Instead, old people who were unable to live independently typically moved in with their grown children. Since there was, in those years, a relatively small time lag between disability and death,¹ such stays were usually for no more than two to three years. Moreover, with a society far less mobile than today, with few women in the workforce, and with a far younger population,² the logistics of such stays were generally manageable.

    Inevitably, however, there were many aged persons without a place to stay and without an adequate family...

  9. 6 Alternatives to Institutionalization: Lessons from Home Care Policy
    (pp. 102-126)

    There is a growing demand for home health care services in the United States. The population of older Americans is expanding, the disabled community increasingly asserts a “right” to home care, hospitals are encouraged by insurers to minimize the length of stay of patients, and nursing home beds are reserved increasingly for the severely and chronically ill. At the same time, however, the network of persons able or willing to informally provide in-home services is declining rapidly: the traditional system of informal care relied upon a society far less mobile than today, with few women in the workforce, and with...

  10. 7 Reducing the Cost of Hospital Care: Lessons from New York and California
    (pp. 127-151)

    The primary mission of the United States’ first hospitals, which were formed during the eighteenth century, was to provide medical care to poor people. Most of these hospitals were publicly owned. New York City’s Bellevue Hospital, for example, began as an infirmary to New York’s Almshouse for the poor.¹ Others were privately operated “charity” institutions, such as the Massachusetts General Hospital. All were avoided by the middle class, who complained (legitimately) about overcrowded wards and poor hygienic conditions, and who received care instead from private physicians making house calls.

    During the late nineteenth century, however, four developments prompted dramatic growth...

  11. 8 Moving Medicaid Clients into Managed Care
    (pp. 152-181)

    While Congress debated whether and how to provide health insurance to the thirty-nine million uninsured, the health care system for the rest of the population underwent a remarkable transformation. No longer do most Americans have indemnity insurance policies, which cover medical care provided by any available doctor, and which pay the doctor a separate fee for every service performed.¹ Instead, Americans today increasingly belong to managed care organizations,² which not only limit consumer freedom of choice, but which also provide doctors with fiscal incentives to reduce the volume of health care.

    The enthusiasm for managed care is especially apparent among...

  12. 9 States and the U.S. Health Care System
    (pp. 182-202)

    For more than two hundred years, policymakers and policy analysts have struggled to determine an appropriate division of labor between the states and the federal government. Back in the eighteenth century, for example, the anti-federalists opposed the ratification of the United States Constitution on the ground that it vested too much authority in the central government. While the states’ rights argument lost that early political battle, the Constitution itself hardly created a powerful federal government. To the contrary, until the 1930s, and the New Deal, the federal government remained relatively uninvolved in most domestic policy arenas.

    Since the New Deal,...

  13. Notes
    (pp. 203-228)
  14. Index
    (pp. 229-235)