Rep. Mike Pence Op-Ed: The Morality of Health Care

“What it’s supposed to do for people doesn’t get done in reality.”

The speaker criticizing this government program wasn’t talking about the federal response to Hurricane Katrina, or failing inner-city schools. Instead, the chief operating officer of a Bronx health clinic was criticizing Medicaid, a program that in theory provides health care coverage to more than 50 million Americans.

In his budget blueprint, President Obama promises $1 trillion in new health care spending to expand the Medicaid program — and create a new government health insurance program — with many of the flaws of the current one.

Even as the White House convenes a health “summit” designed to build support for yet more entitlement spending, it’s important to remember that our current entitlements often neglect the poorest and most vulnerable Americans.

Investigations by the New York Times in 2005 confirmed the often-cited problem that a Medicaid insurance card doesn’t guarantee quality care. In fact, it doesn’t guarantee care at all.

The report cited Medicaid as paying $24 to specialists in New York City for an office visit — not nearly enough to cover physicians’ true costs. Not surprisingly, few specialists decide to participate in Medicaid, so patients must wait — and wait and wait — to receive care.

Meanwhile, the New York Medicaid program’s spending ranks highest in the country, likely because 40% of Medicaid spending goes to questionable or fraudulent claims, according to a former state investigator.

The overall picture is one of a dysfunctional Medicaid program struggling to meet the health care needs of the poorest Americans. Yet these systemic problems are rarely mentioned when talking about health care reform.

While Democrats talk about the “moral imperative” of covering all Americans, few words have been spoken for those who have a public insurance card — but no access to care.

Consider the case of Deamonte Driver, a 12-year-old Maryland boy, who died in 2007 when a tooth infection spread to his brain. A simple extraction costing under $100 could have saved his life — if his mother had not had to wait five months for Deamonte and his brother to receive treatment under Medicaid.

Testifying before Congress about this tragedy, a case worker who helped Deamonte’s family criticized a culture “that clearly condones gross underperformance” at both the state and federal levels and has become “accepted and widespread.”

It is a culture that required Deamonte’s mother plus a lawyer, three call center workers and a call center supervisor to schedule a single dental appointment.

It is a culture that lets a dentist in Brooklyn bill Medicaid for many patient visits in the same day, yet turns away a poor teenager three times without even asking her to fill out a Medicaid application.

It is a culture that fails the poorest and most vulnerable in our society and a culture that money alone will not fix.

Democrats and the president have focused on increasing federal Medicaid spending as an economic “stimulus.”

Providing $90 billion in new federal Medicaid spending without reforming the program, as the recent “stimulus” bill did, will not ensure better coordination of beneficiary care, will not create an administrative bureaucracy more responsive to patients and providers, and will not crack down on fraudulent spending that squeezes state and federal budgets alike.

A better way exists, and that is fundamental reform. One building block of reform would focus on a major inequity in the tax code. That code says individuals whose employers can’t afford to provide coverage — like Deamonte Driver’s mother — must use after-tax dollars to purchase health insurance.

That means that many hardworking people least able to afford insurance premiums must pay 30% to 50% more for coverage. Fixing this inequity in our tax code would let more individuals purchase their own policies.

When combined with insurance reforms that provide access to chronically ill people, and reforms that let state Medicaid dollars supplement private insurance premiums, many more people will have quality insurance coverage.

Unfortunately, our Democratic colleagues have blocked states’ efforts to test innovative ideas that would provide the improvements Medicaid needs — reforms designed to ensure coverage people can use, not just an empty promise of care.

Republicans see a better way.

Our party recently formed a task force to craft a proposal that would ensure true reform of our health care system, including proposals to improve the health or lives of those many Americans who need it most.

Our Democrat friends may be well-intentioned. But their plans would expand a failed government culture that has neglected the poor Americans it is supposed to serve. Throwing more taxpayer money at a structurally flawed program is not an audacious hope. It is a false one.

This post was originally published in Investor’s Business Daily.

The Case for Medicaid Reform

Beneficiaries Do Not View a Medicaid Card as “Real Insurance”

Although Medicaid in theory provides health coverage to more than 50 million Americans, beneficiaries often find their coverage lacking when they need it most.  Poor reimbursement levels can result in months-long waits for specialist visits, while arcane bureaucracies discourage providers from participating in Medicaid—and patients from obtaining necessary care:

  • A recent Centers for Disease Control study found that Medicaid patients visit the emergency room at nearly twice the rate of uninsured patients—suggesting that a Medicaid card does not mean that beneficiaries are receiving adequate primary care.[1]
  • In Maryland, reports regarding 12-year-old Deamonte Driver—who died last February when a tooth infection spread to his brain—found that it took his mother, a lawyer, three call center workers, and a call center supervisor to schedule one dentist’s appointment for Deamonte’s brother—who then had to wait five months to have his teeth pulled.[2]
  • One Michigan mother quoted in The Wall Street Journal last July expressed exasperation with the Medicaid program: “You feel so helpless thinking, something’s wrong with this child and I can’t even get her into a doctor….When we had real insurance, we would call and come in at the drop of a hat.”[3]

Beneficiaries Who Do Get Care Do Not Receive Quality Treatment

The lack of transparency and care coordination within many state Medicaid programs, coupled with frequent waits to obtain care, yield poor health outcomes, as a review of one state’s Medicaid claims data demonstrates:

  • Only 17% of women over age 50 received annual mammograms—well below the 100% recommended.
  • Less than half of children received check-ups—a lack of preventive care which could result in undetected problems and costly episodes of acute care in the future.
  • One beneficiary visited the emergency room 405 times within a three-year span—an indicator of poor or un-coordinated primary care, resulting in increased costs to the state.[4]

Taxpayer Funds Are Not Being Spent Prudently

Despite the poor outcomes demonstrated by many Medicaid participants, numerous reports suggest that programs do not spend their taxpayer funds wisely.  In addition to inefficiencies resulting from poor or non-existent co-ordination of care, outright fraud and abuse remains systemic in many state programs:

  • Reports by The New York Times in 2005 found that the state Medicaid program had reimbursed a Brooklyn dentist who billed Medicaid for 991 procedures in one day—even as the same newspaper found a poor teenager turned away three times without being asked to fill out a Medicaid application.[5]
  • A former New York state investigator estimated that up to 40% of all state Medicaid claims paid—representing nearly $18 billion for New York alone—are questionable.[6]
  • The Government Accountability Office (GAO) has frequently criticized the lack of accountability within the Medicaid program, including a May 2008 study where GAO could not provide a total amount of supplemental payments by state Medicaid programs—because state reporting on the billions of dollars spent was incomplete.[7]

Given the structural deficiencies associated with many state Medicaid programs, conservatives may view any attempt to give states a “blank check” to spend more on Medicaid without new accountability or reforms as a disservice to both the federal taxpayer and the needy beneficiaries which the program is designed to serve.


[1] National Hospital Ambulatory Medical Care Survey: 2006 Emergency Department Summary (Hyattsville, MD, National Center for Health Statistics, August 2008), available online at (accessed September 13, 2008), Figure 3, p. 3.

[2] Testimony of Laurie Norris, Public Justice Center, before House Oversight and Government Reform Subcommittee on Domestic Policy, “The Story of Deamonte Driver,” May 2, 2007, available online at (accessed September 13, 2008), pp. 5-6.

[3] Vanessa Fuhrmans, “Note to Medicaid Patients: The Doctor Won’t See You,” Wall Street Journal July 19, 2007.

[4] All data cited in testimony of Jim Frogue, Center for Health Transformation, before House Energy and Commerce Health Subcommittee, “State Fiscal Relief,” available online at (accessed September 13, 2008).

[5] Clifford Levy and Michael Luo, “New York Medicaid Fraud May Reach into Billions,” New York Times July 18, 2005, available online at (accessed September 13, 2008); Richard Perez-Pena, “Trying to Get, and Keep, Care Under Medicaid,” New York Times October 18, 2005, available online at (accessed September 13, 2008).

[6] Levy and Luo, “Fraud May Reach into Billions.”

[7] “Medicaid: CMS Needs More Information on the Billions of Dollars Spent on Supplemental Payments,” (Washington, Government Accountability Office, Report GAO-08-614), available online at (accessed September 13, 2008), p. 14.