Medicaid Realities: More Harm than Good

By: Tamzin A. Rosenwasser, M.D.,

On January 7, 2011, 33 governors and governors-elect sent a letter to the White House and Congressional leaders detailing how new federal Medicaid mandates will drown their states in more debt.

To almost everyone except physicians, Medicaid patients are an abstraction. They are the poor and the sick, who will allegedly bleed to death in the streets if heartless budget cuts go through. Except to the governors, the states' financial hemorrhage may also be an abstraction. But the consequences will soon be impossible to ignore. Some even venture to suggest that states withdraw from Medicaid.

While civilization without Medicaid seems unthinkable to many today, until 45 years ago we managed without it. Like so many things, it started slowly, around the same time as "aid" to families with dependent children-that is, mostly families without a father living in the home. It is a verity of life that whenever government subsidizes something, it grows. Therefore, we saw a great increase in dependent children of families with no father to provide for them.

Providing help to the needy just seems like the charitable thing to do. But government handouts and charity are two different things.

Charitable individuals and organizations can make informed decisions about where to bestow their beneficence. They can ask why people are in the situation that leads them to ask for help. Did their house burn down? Were they wiped out by a hurricane? Did some unforeseen medical disaster occur? Also, are they doing what they can to help themselves? Are they spending a minimum of $60.00 per month on cigarettes, or hundreds of dollars on tattoos or iPhones? Government cannot ask such questions. Medicaid benefits are dispensed by the rules, which are open to manipulation and abuse. There is no incentive for people on Medicaid to give it up.

There is an incentive for wealthy people who need nursing home care to go to "Elder Care" lawyers who can help them qualify for Medicaid. There is an entire category of lawyers who advise people how to avail themselves of government "benefits" to which they are "entitled" by creative ways of transferring their assets. All that money comes from working people, people who may not have parents who will be leaving them assets.

Speaking as a physician who worked for several years in a large city emergency room, I personally have had someone capable of walking in high heels ask me to certify that she needed a motorized wheelchair. I personally have had a Medicaid recipient ask me to write a prescription for detergent, and another consult me about excess hair. The last is an example of what has been termed the medicalization of discontent. A large percentage of those on Medicaid appear to be able to afford TV sets, and some of them read women's magazines, where drugs for excess hair and yellow toenails are advertised. No problem is too trivial, when you personally have the U.S. taxpayers and their Treasury's purse at your disposal, in a system of all-you-care-to-eat medical services.

If the taxpayers personally saw their money being spent in this way, they wouldn't like it. And neither do the people providing the service. The Emergency Room where I worked was staffed by people from the same background as the patients, with one difference. The staff were working and paying taxes, and many of the patients who could have been working were not. The staff knew that, and they disapproved. Moreover, they knew the system was treating them as dupes, and they resented it.

I am no longer in that Emergency Room. The "reimbursement" from Medicaid and Medicare was so low that the hospital went bankrupt. However, the government employees who administer the program, signing people up, checking eligibility, processing claims, and sending out checks have been paid-so far. Administrative costs are many times what the physicians are paid for actually doing the work of medical care.

Physicians who take care of Medicaid patients receive checks, but really do the work free, because the checks do not even cover the costs, including the liability, of seeing the patients. But the whole system is still going bankrupt. In one state, almost 28 percent of a $33.3 billion budget is devoured by Medicaid. There are endless demands for the "free" service. Then the bureaucracy spends billions trying to keep track of every sniffle, and every 10-minute office visit.

Now that Congress is reading the Constitution, they may notice that nothing in it allows the government to take money from one citizen to bestow it on another. And as the governors are pointing out, the laws of economics are about to set a limit. We are no longer rich enough to continue this nonsense.

Medicaid tried to replace charity with entitlement. The experiment has failed. The safety net for the truly needy still relies on charity. And how much better off would the poor and the sick be if we did not squander vast resources as mandated by Medicaid rules?

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Dr. Tamzin Rosenwasser earned her MD from Washington University in St Louis. She is board-certified in Internal Medicine and Dermatology and has practiced Emergency Medicine and Dermatology. Dr. Rosenwasser served as President of the Association of American Physicians and Surgeons (AAPS) in 2007-2008 and is currently on the Board of Directors. She also serves as the chair of the Research Advisory Committee of the Newfoundland Club of America. As a life-long dog lover and trainer, she realizes that her dogs have better access to medical care and more medical privacy than she has, and her veterinarians are paid more than physicians in the United States for exactly the same types of surgery.