Medicaid Realities: More Harm than Good

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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?


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.

11 Comments

  1. Excellent article, right on target, explains fully and rationally what is wrong with the medical system as currently controlled by the federal government. And all said with none of the circular reasoning and retoric that characterizes most of the commentary coming out of the Congress, the liberal right, and the current administration. My compliments, and I hope we can all work together to bring about some real change. As a society, especially where caring for the needy is concerned, we need to, in essence, go backwards to a point where individual choice and individual responsibility were encouraged. This author is so correct, and has expressed so well what I’ve long believed, that we replaced charity with entitlement, and it absolutely doesn’t work.

  2. Kudos to the author. I am a solo private practice doctor and we quit taking Medicare and Medicaid years ago. Payments are ridiculous not enough to cover expenses.

  3. A brave statement, and one that is at the heart of the problem. Nowhere is this more true than in the state of Vermont, where people move “because the benefits are better here” As an RN for 40 years in many areas I have had patients say those very word as they come to the ED for their health care. In our Ophthalmology office we have patients who cannot pay for their exam but who can request contact lens fittings and seem to have no problem paying cash for those items.

  4. Bravo, Dr R.
    It is hard for doctors to love helping the cheats and moochers spawned by the czar care system. Loss of love is bigger than the loss of money.

    Replace Medicaid with vouchered high deductible insurance (as in the Ryan Roadmap) so people spend their own money for care they appreciate. Meantime, patients pay me a little for care missed at the public clinic.
    Howard Long, Country Doctor

  5. Dr. Rosenwasser:

    The response from “Intelligent Conservative” concerning your Article on Medicaid Realities-More Harm than Good expresses my thoughts also:

    “Excellent article, right on target, explains fully and rationally what is wrong with the medical system as currently controlled by the federal government. And all said with none of the circular reasoning and rhetoric that characterizes most of the commentary coming out of the Congress, the liberal right, and the current administration. My compliments, and I hope we can all work together to bring about some real change. As a society, especially where caring for the needy is concerned, we need to, in essence, go backwards to a point where individual choice and individual responsibility were encouraged. This author is so correct, and has expressed so well what I’ve long believed, that we replaced charity with entitlement, and it absolutely doesn’t work”.

    I also, applaud these governors for their concern and hope that they will inform the American people on how we can help to accomplish the abolishment of Medicaid.

    Yours truly,

    Dan DellaRova

  6. The fiscal insolvency of this country will in the end force our country back to individuals needing to work to have what they need, and charitable entities will again take care of those who are in truth in need.

  7. How about if you don’t have a job and you don’t pay any personal or property taxes you don’t get to vote! Felons don’t get to vote, let’s include sloth as well.

  8. HR 3590 AUTHORIZES $1,900,000,000 to FUND a District of Columbia Non-Profit Agency to do: “Subtitle D—Patient-Centered Outcomes Research” that would in the words of the bill LISTED UNDER:
    ‘‘(iii) COVERAGE OF COPAYMENTS OR COINSURANCE” states this agency will do research “necessary to preserve the validity of a research project, such as in the case where the research project must be blinded (MUST BE BLINDED it states – must be! Is this not a license to EXPERIMENT ON AMERICANS – Giving expensive BUT life-saving treatment to one and a cheaper alternative to another that could result in their death WITHOUT THEIR KNOWLEDGE OR CONSENT OR COMPENSATITION – NON-PROFITS – Not subject to FREEDOM OF INFORMATION requests? GOOD WAY TO HIDE CONTROVERSIAL ITEMS

    Here is the section of the bill near the top of the PDF file on the GAO website where this was stated:
    SEC. 6301. PATIENT-CENTERED OUTCOMES RESEARCH
    ‘‘PART D—COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH
    ‘‘SEC. 1181. (a) DEFINITIONS:
    ‘‘(A) IN GENERAL.—The terms ‘comparative clinical effectiveness research’ and ‘research’ mean research evaluating and comparing health outcomes and clinical effectiveness, risks, and benefits of 2 or more medical treatments, services, and items described in subparagraph (B).
    THANK YOU AAPS FOR CAREING ABOUT US YOUR PATIENTS AND SUPPORTERS.

  9. Thank you for speaking out. I agree, the medicaid system needs to be fixed. It really is aggravating when I see so many believing that money comes from the government in the form of a adc check. While the fathers sit around and do nothing to support the children they help bring into the world. Just sit and wait for the check to come in the mail. The people that work everyday and pay their taxes are fed up with this system. Some sort of birth control needs to be implemented and I don’t mean abortion. Some sort of control to these birth rates. If non-compliance, take away their check. Do I sound hostile and unsympathic? Not so, just plain and simple fed up. It just can’t keep going the way it is……I work with a girl that has 4 children, lives with the father out of wedlock , brags about the $700 dollar house she rents (while the guy who is married and makes just over minimum wages and has kids and is struggling to put a roof over their heads) and then she complains about the high energy bills, turns around and says oh well I know where I can go get help with that too. A majority have gotten to the point they just continually have their hand out. We had our first child while we were young and had no insurance. Do you know what we did? We made a payment to the hospital and doctors until we had them paid off. I am in support of change in the medicaid system…

  10. An interesting article filled with some carefully selected anecdotes. But I suggest the problem goes much deeper than the doctor is willing to admit or even realizes. While it’s true that The Constitution makes no mention of taking money from one group and giving it to another, it also makes no mention of profiting exorbitantly off the suffering of others. And while it’s true that abuse in the bureaucracy exists; it is also true that abuse in the medical industry exists as well. The argument continues when vested interests based oftentimes on greed push their own agendas. Ultimately, the real problem is the sinfully high costs of medicine. So here’s one more anecdote: A well-off independent businessman I knew was diagnosed with lymphoma. Within two years the medical industry reduced him to penniless. He was forced to go on Medicaid. He eventually died leaving a wife and four children in poverty. Yes, the system needs to be fixed but unless we examine it eclectically we will continue to embrace the myopic views of a few with their own agendas.

  11. @CarolynLaneRN , I’m assuming you are a Vermont Resident. I am a Pediatric Occupational Therapist in Vermont and working against the push for Single Payer in this State. We are trying to get a group together of healthcare professionals against this push. I am very concerned about the fact that the Nurse’s Union has come out in support of this. Would you be interested in working with me on a way for those in the healthcare field to join a group to take a stand against this? I know a Doctor who is also willing to work on this too. It will give other healthcare providers the strength to come forward. Could you contact me? My e-mail is [email protected] If there are any other VT providers on this string interested, please send me an e-mail too! Thanks!

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