Surgery Study Finds Poor at a Disadvantage


As California has reduced Medicaid payments for expensive heart surgeries, the likelihood that indigent patients will receive the surgeries also has dropped, even though Medicaid patients are typically sicker than those with fee-for-service or HMO insurance, Chicago researchers report today.

The team studied 140,000 patients who were treated in all non-federal hospitals in California in 1983, 1985 and 1988.

In 1983, when Medicaid covered 92% of hospital costs, patients with conventional fee-for-service insurance were 1.66 times as likely as Medicaid patients to receive coronary bypass surgery or angioplasty to improve blood flow to the heart. By 1988, when Medicaid covered only 70% of costs, the ratio had climbed to 2.33, the researchers report in the New England Journal of Medicine.

Similar restrictions in the care of Medicaid patients also were observed for gallbladder disorders and hysterectomies.


“We found that with greater emphasis on cost containment, decisions about whether or not to provide certain types of care became more and more strongly associated with a patient’s insurance status,” said public policy specialist Ken Langa of the University of Chicago Medical Center, co-author of the study.

Medicaid is a federal program that funds medical care for low-income people.

The findings could have major implications for President Clinton’s health care reform plans, particularly his suggestion that $112 billion could be trimmed from Medicaid budgets over the next five years, said co-author Dr. Elliott J. Sussman of the Lehigh Valley Hospital in Allentown, Pa., formerly of the University of Chicago.

Sussman said that the savings are unlikely because more money will be required to bring the level of care of Medicaid patients up to that of privately insured patients. “We are already tremendously under-providing care,” Sussman said.


The findings “do not surprise me in the least bit, but I would not necessarily attribute the lower rates to the fact that hospitals are getting paid less. That has a sinister implication and I am not sure it is that simple,” said Dr. Frank Litvack, co-director of the cardiovascular intervention service at Cedars-Sinai Medical Center.

Other potential reasons, Litvack suggested, may be that Medicaid patients are selectively admitted to hospitals that do not perform the procedures, that the patients may not be as willing to undergo surgery or that they are not receiving adequate long-term care and are thus not in good enough health to undergo the procedures.

California hospitals were studied, Sussman said, because “as goes California, so often goes the rest of the nation.” Furthermore, he said, California offered a “natural experiment” when it went to the Selective Provider contracting program in 1983, which required hospitals to compete for state contracts to serve Medicaid patients.

That change meant that hospitals got a flat rate for procedures such as bypass operations, effectively reducing reimbursement from 92% of actual cost to 70%. The remainder of the cost is thus shifted to private insurers, Litvack said, which forced them to raise rates.


Sussman and Langa, a Ph.D. and a fourth-year student in medical school, divided the patients into three groups: those with fee-for-care insurance, such as Blue Cross/Blue Shield; those belonging to a health maintenance organization, and those on Medicaid.

In 1983, patients with fee-for-service insurance were 1.66 times as likely to receive a bypass or angioplasty as Medicaid patients. By 1985, they were twice as likely, and by 1988, 2.33 times as likely.

HMO patients were actually less likely than Medicaid patients to receive the surgeries in 1983. But they were 1.23 times as likely in 1985 and 1.53 times as likely in 1988.