AMA calls for tax credits for Medicaid patients, uninsured

Monies received could be used to buy private insurance coverage.

By Joel B. Finkelstein, amednews staff. July 7, 2003.

Chicago -- Medicaid's structure is unsustainable and should be replaced with a system of health care tax credits that would help both Medicaid patients and uninsured Americans, AMA delegates voted at last month's Annual Meeting.

In these trying financial times, states are pulling back funding from Medicaid, worsening prospects for both patients and doctors in the program. Federally funded, refundable and advanceable tax credits would ease the burden on the states by moving the bulk of the Medicaid and uninsured populations into private plans, according to the report from the Council on Medical Service adopted by AMA delegates.

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Instead of providing government-mandated health insurance, Medicaid should be a funding mechanism that allows low-income Americans to "choose and own their coverage," the report states.

Several delegates attending the meeting spoke in support of the report. "This is a good first step toward broad health care reform," said Cardin Johnston, MD, a delegate from the American Academy of Pediatrics.

"Tax credits ... appear to be a road map out of this morass of the uninsured, the underinsured, the disabled and so forth," said Bohn Allen, MD, a delegate from Arlington, Texas.

Concerns voiced

However, some physicians said the report neglects possible potholes on that road.

While the "political tides" seem to favor tax credits, Dr. Johnston said he would be wary of any change that creates more administrative hurdles.

Dale Moquist, MD, a delegate from the American Academy of Family Physicians, said he was concerned that the council did not place a greater emphasis on preventive care. "If we're addressing health system reform, we need to look at that issue," he said.

Some delegates were also concerned about Medicaid benefits that would likely be lost by moving patients to private insurance.

Medicaid pays for transportation services that private plans may not, said Barbara McAneny, MD, an American Society of Clinical Oncology delegate. Such services are essential for patients without cars or access to reliable public transportation.

"Patients who live out in rural areas have to come ... hundreds of miles to see physicians," she said. "Normal insurance doesn't cover that."

Some physicians said they were concerned that taking a tax-credit approach potentially overestimates patients' health care literacy.

Others disagreed. "There is no reason to think that the average person in the United States is not smart enough to manage their own care. They buy houses, they buy home insurance, they buy all kinds of services," said Dr. Allen.

Several attendees stood up to offer their own reform ideas.

Legislation recently introduced in Congress proposes the use of tax credits for working families, but would also expand Medicaid and the State Children's Health Insurance Program.

That bill was drafted with the help of the American College of Physicians and several specialty societies.

"ACP believes that it is critically important that medicine seek common ground and a unified voice on the issue of making health insurance coverage available to everyone, starting with the working poor," said ACP President Munsey S. Wheby, MD.

Dr. McAneny said that if Medicaid is to rely more heavily on private insurers, the plans' profit margins need to be regulated and the program should be overseen by physicians instead of just bureaucrats.