Medicaid is in the budget bull’s eye. But many lawmakers aiming to cut the program have no idea what it does, and how important it is to frail seniors who need help with daily living. The popular image of Medicaid: health care for a poor mother and her children. The all-too-common reality: long-term supports and services for an 85-year old widow with dementia.
With Congress and President Obama looking for both a short-term way to avoid the dreaded fiscal cliff and a long-term deficit reduction deal, Medicaid and Medicare are at the top of the hit list—in large part because they are so costly.
Let’s leave the debate over Medicare for another time. But Medicaid, frequently lumped in with Medicare and Social Security as one of those vaguely threatening “entitlements,” is another matter.
Medicaid, jointly funded by the federal government and the states, does two jobs. It provides health care for those poor mothers and their kids—who represent about three-quarters of enrollees. But two-thirds of the Medicaid budget is spent on the frail elderly and younger people with disabilities. And one-third of all Medicaid spending—about $120 billion– is for their long-term care alone.
In recent months, conservatives have taken up the cry that the U.S. has become a “Nation of Takers,” to borrow the title of a recent book by American Enterprise Institute scholar Nick Eberstadt. It became a common campaign theme of GOP presidential candidate Mitt Romney. A recent column by Washington Post columnist Bob Samuelson nicely summarizes this view. And too often Medicaid is casually tossed into the conversation.
So who are the Medicaid takers? Among the elderly, they are among the nation’s most vulnerable. They are frail, often suffer from multiple chronic diseases (such as heart failure, dementia, or diabetes), and are impoverished. Many were once middle class but, due to illness, are without financial resources in old age.
Look at the roughly 9 million people who are sick enough and poor enough to be eligible for both Medicare and Medicaid (often called the dual eligibles, or just the “duals”). Some are poor, but relatively healthy. Many others are not.
Two-thirds of the duals are aged 65 or older. According to MedPAC, the independent commission that advises Congress on Medicare, 38 percent have cognitive or mental impairments, 22 percent have multiple physical impairments, and 23 percent live in nursing homes or other institutions.
Sixty percent of those duals who live in nursing homes or other institutions have dementia or some other cognitive impairment. According to the Kaiser Family Foundation, one-quarter of elderly who are eligible for both programs need assistance with at least three activities of daily living (such as bathing, going to the bathroom, eating, or dressing). Many are, in other words, helpless.
Among the 1 million dual eligibles who are the most costly Medicaid patients, nearly half are aged 80 or older, three-quarters need help with 3 or more activities of daily living, three-quarters live in institutions, and one out of every six has Alzheimer’s.
Ninety percent are poor or near-poor. More than half have incomes of less than $10,000. And 90 percent have no other insurance. According to Kaiser, 70 percent are women and only about 20 percent are married. Some have adult children to care for them. Many others do not.
There is no doubt the U.S. has a long-run budget problem, and that we need to do a better job caring for the frail elderly who are chronically ill and need both medical care and long-term services. Maybe we can find a way to provide these people with better care and save money. Maybe we can find an alternative to Medicaid, at least for people who were once middle-class. But taking a meat axe to Medicaid in a frantic attempt to hit a politically-motivated budget target is not the way to do it.