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Having U.S. Medicaid insurance may increase ER use: study

The federal government forms for applying for health coverage are seen at a rally held by supporters of the Affordable Care Act, widely refe
The federal government forms for applying for health coverage are seen at a rally held by supporters of the Affordable Care Act, widely refe

By Julie Steenhuysen

CHICAGO (Reuters) - Expanding access to Medicaid, a major plank of President Barack Obama's health reform law, could increase emergency room visits by people on the healthcare program for the poor rather than decrease them, results of a study published on Thursday suggest.

A unique experiment in Oregon in which residents were randomly given Medicaid insurance cards, showed their visits to the emergency room increased by 40 percent, a sobering statistic as many states face an influx of new Medicaid patients under the

new law.

The study, published in the journal Science, suggests simply providing insurance coverage to low-income Americans will not be enough to curb their use of emergency rooms, which for many has been the only place they can turn when health problems become acute and more costly to treat.

The research, based on records from thousands of emergency room visits, did not shed light on why ER visits increased.

Opponents of the Affordable Care Act seized on the study as evidence that the law will lead to higher costs for the healthcare system rather than save money over time.

The law, popularly known as Obamacare, allows states to expand Medicaid to millions more of their residents. Coverage under the new criteria, which have been adopted in some form by 26 states, took effect on January 1.

The Obama administration estimated in September that Medicaid enrollment will increase by 8.7 million in 2014, nearly all as a result of the Obamacare expansion.

The findings seem to counter Obama's assurances that his medical coverage overhaul will ease pressure on emergency rooms and suggest ER spending could increase by half a billion dollars per year, said Michael Cannon, a healthcare expert at the libertarian Cato Institute in Washington.


Cannon based that estimate on the study authors' estimate that Medicaid increases annual spending in the emergency department by about $120 per covered individual.

Dr David Ansell, chief medical officer of Rush University Medical Center, which serves low-income patients from Chicago's West and South sides, said he was not surprised by the findings, noting that the uninsured have been "trained" to turn to the emergency department for care.

"We will change behavior when we change people's experiences. It will take time," he said.

Some proponents of Medicaid expansion say the coverage will encourage people to first seek care with primary care doctors, who can help identify health problems with preventive screenings and manage chronic ailments, reducing the need for high-cost care in an emergency department.

"What we find is that Medicaid increases emergency department use," said study lead author Sarah Taubman of the National Bureau of Economic Research, a non-partisan research group based in Cambridge, Massachusetts.

To study this issue, Taubman and colleagues turned to the Oregon Health Insurance Experiment, a study in which the state randomly picked a group of low-income adults to receive insurance coverage under its Medicaid program.

Taubman's team examined emergency room records for roughly 25,000 low-income adults in the Portland area over a period of 18 months. Of those, 9,626 were selected to receive Medicaid and 15,020 served as a control group.

They found that among people who got Medicaid, emergency department visits per person went up by 0.4 percent over 18 months compared with similar uninsured individuals.

"It's an increase of about 40 percent," Taubman said.

Taubman said the lottery gives a rare opportunity to study the policy change using a randomized trial, an especially rigorous type of study, lending added confidence in the findings.

The findings "explode the myth that health insurance access will reduce the strain on emergency services," a major driver of healthcare spending in the United States, Raymond Fishman of Columbia Business School wrote in an accompanying commentary published in the same journal.

Twenty-five mostly Republican-run states have rejected the Medicaid expansion, arguing that the initially generous federal subsidies to the states will taper off and leave them with a huge healthcare bill.

(Reporting by Julie Steenhuysen; Editing by Michele Gershberg, Ross Colvin and Grant McCool)