Why We Need Medicare For All Pregnancies
The time for policy action is now.
As we think about how to rebuild from whatever depths the COVID-19 crisis will bring us, I would like to propose Medicare for All Pregnancies as a policy priority. Here’s why.
Even before COVID-19, the need to fix maternity care in the United States was urgent. Alarm bells were ringing and major commitments were being made to focus resources on maternal health, especially eliminating racial disparities.
The maternity care crisis has been looming and growing for decades, but finally there was political action. Presidential candidates debated plans to address it, and there was bipartisan support for a major legislative package in Congress incorporating some of these plans — the Black Maternal Health Momnibus.
In fact, on March 3 the U.S. had 126 COVID-19 cases, but here I am with Surgeon General Jerome Adams at an event where he and Governor Ned Lamont spent half a day rolling out a major initiative to address maternal death and serious morbidity in my own state of Connecticut.
There is much more to say about the problems and opportunities in maternity care. (Here is my list of favorite resources explaining the issues and need for advocacy.) But from the momentum we had just a month ago in maternity care, it is clear that our leaders already knew we needed to make a major investment and deepen our commitment to fix this mess.
How we pay for maternity care will not work in the COVID-19 recovery era
Pre-COVID, maternal and newborn admissions were the most common and costly hospitalizations for both Medicaid programs and employer-based health plans. How we paid for all this care has never worked well, but it certainly will not work in the COVID-19 recovery era.
Forty-nine percent of births are paid for by private insurance and 43% are paid for by Medicaid or CHIP, which are state run programs where the federal government foots about half the bill and the states pay for the rest. COVID-19 presents unique challenges for both groups.
In the private insurance market, most plans are tied to employment, and of course we are seeing rates of job loss that are an order of magnitude higher than previous records. Many, many people will lose their pregnancy coverage.
These people will get their insurance from the exchange marketplace, they will become eligible for Medicaid, or they will remain uninsured and face the dangers that come from the lethal combination of high uninsurance and high barriers to pregnancy Medicaid enrollment — a combination we have seen play out to horrifying effect in Texas.
Those who can afford or get subsidized insurance through the exchange will most likely end up with high deductible plans, where most benefits don’t kick in until you’ve spent your deductible.
Pregnancy almost guarantees you will hit your deductible — maybe twice if you’re unlucky enough to get pregnant in one year and deliver the next. For a family, that’s $13,500 (or up to $27,000 if pregnant in two calendar years). Who has that saved up? Especially now??
For people with Medicaid or CHIP coverage, out-of-pocket costs can be low, but access is limited and quality is often poor.
That’s in large part because of an inconvenient truth we don’t often talk about — Medicaid pays only about half what private insurers pay for birth, even though the needs of the Medicaid-insured population are often greater. It’s almost as if we collectively decided that Medicaid-insured moms and babies are worth half as much as those privileged enough to have insurance.
OB-Gyn practices deal with this by not accepting Medicaid at all, or by “optimizing the payer mix” to subsidize the care of the Medicaid-insured by having enough patients with private insurance, and by doing enough revenue-generating procedures and surgeries to make the numbers work.
These practices, increasingly owned by private equity companies, can limit Medicaid caseloads because they are allowed to by law and because there is a so-called “safety net” to care for the rest. However, our safety net was under massive stress to begin with, and with the crushing burden of COVID-19 our safety net is failing right now.
The price disparity also means practices that have optimized their payer mix will see a massive loss of revenue as a large number of patients lose their insurance and switch to Medicaid plans. This will come on top of major losses from cancelled primary care visits, surgeries, and testing during the pandemic.
The surge will also have a huge impact on state budgets
Andrew Cuomo may be America’s hero right now, but he’s still planning to cut Medicaid rates in New York, which will worsen outcomes for pregnant people and newborns and widen racial and economic disparities.
That’s because the reality is that states truly can’t afford the growing cost of Medicaid. It has increased unchecked for decades, thanks to runaway prices and the high cost of our poor outcomes like preterm birth, cesarean overuse, and maternal morbidity.
States were also hit hard by the pharmaceutical industry, which drained budgets for high-priced drugs with little or no benefit, like the 100x increase in the price of a popular preterm birth prevention drug that turned out not to work.
And unlike the federal government, which has the ability to borrow funds in order to stimulate sectors of the economy, states are required by law to balance their budgets every year. So the surge of new Medicaid enrollees means cuts have to come from somewhere.
Federal stimulus to resuscitate maternity care
So, neither employers nor states can manage the cost of pregnancy, birth, and postpartum care for their populations, and families are in no position to take on the extra burden. That’s especially true because we already knew we needed to invest more, not less, in maternity care.
The federal government will have to choose the investments it is going to make in our society, health, and prosperity over the coming months and years. An obvious investment, to me, is #MedicareForAllPregnancies:
One federally funded plan that covers all pregnancy- and newborn-related healthcare costs, throughout pregnancy, birth, and a full year postpartum.
This would lift the crushing burden of maternal and newborn healthcare costs so that families, businesses, and states can get back on their feet more easily. But it’s not just about costs. Medicare for All Pregnancies could also have a major impact on quality, safety, and innovation.
With one payer, we could more readily invest in care models that work and incentivize outcomes that matter. Take, for example, midwife-led birth centers.
A major federal study called #StrongStart showed this model resulted in reduced preterm birth, cesareans, and costs, as well as higher satisfaction. But efforts to scale it have been stalled by an inefficient patchwork of Medicaid and private insurance. The system is not structured to pay for this care and offers little incentive to solve the problem.
There are countless other evidence-based care practices and delivery models that could be implemented, evaluated, and scaled if each practice wasn’t dependent on such a broken payment system.
We’ve known the payment system has been broken for a while, of course, and reformers have been talking about incremental ways to transform the system over time to move it away from the current status quo that financially rewards the very outcomes we are trying to rein in: neonatal intensive care utilization, cesarean birth, longer hospital stays, and more.
Because pregnancy, birth, and postpartum are such well-defined time-periods compared with other healthcare needs, maternity care is seen as an obvious candidate for bundled payment schemes that pay one price for the full episode of care and link payment to quality and value.
Although bundled payment for maternity care has been a hot topic for at least a decade, implementation has faced challenges in the fragmented payment market, and new value-based models have not been successfully scaled up.
With Medicare for All Pregnancies, the federal government would be a single and very influential payer for all pregnancy, birth, and mother/baby care, so bundles and other value-based payment schemes will be much easier to administer. They will also provide the data we will need to continually evolve and improve how we pay for care to achieve equity and quality.
Medicare for All Pregnancies would also, of course, be an important incremental step toward #MedicareForAll. The full package will take many years to transition, but moms, babies, and the birth of a new generation seems like the right place to start.
photo credit: Dos Rayitas on Flickr