Which is Better? "Co-pay" or "No Pay"

By John Ballard

Consider this.

When Medicare plans raise co-payments for outpatient care, older people cut back on doctors� visits, then wind up needing more expensive hospital care, a new study reports.

The study examined changes in the use of inpatient and outpatient care among people in Medicare plans that almost doubled co-payments, and compared the trends with similar plans that kept co-payments steady.

...�This is an ill-advised cost containment strategy,� said [a NEJM study] lead author, Dr. Amal N. Trivedi, an assistant professor of community health at Brown University. �The increase in outpatient co-pays appears to produce both greater health care spending and worse health.�

"Co-pay" has been part of our vocabulary for so long many people no longer think it is important. With the same careless attitude that prompts Gesundheit after a sneeze or quick indifference employed to decide how much to tip the waitstaff,  co-pays for medical tests and procedures are tossed off like dollars at a fund-raiser.

What is the thinking behind co-pays?

The quick answer is that people tend to waste what they think is "free." We don't want anyone trotting off to the doctor for every little sniffle, so the co-pay is more about reducing valuable time and materials wasted at the clinic or doctor's office than collecting money. 

As the study cited above shows, that is not only false thinking, the use of co-pays may very well cause just the opposite of what we imagine. Common sense reasoning is that people on limited incomes, watching every little expense, unfortunately self-ration health care to a damaging extent.

What might happen if there were no co-pays?

Even before asking the question I expect screams from many places. Tax-conscious citizens, mostly young and health and well-insured, will envision a surge of costs as legions of Medicare and Medicaid beneficiaries descend on medical facilities across the land. It goes without saying that private insurance companies would shudder at the notion since "medical payouts" are an expense, not the benefit that policy-holders imagine. 

When Ronald Reagan coined the term welfare queen in 1976 he set in motion a popular myth about social services that led to massive ignorance influencing policies for the next three decades. The mindless result  came full circle with Medicaid beneficiaries being charged co-pays for needed drugs and services. A quick search for "Medicaid co-pay?" returns a rash of results, many dated during the last five years, which presage the same inverted impact on good health reported in the Times article which inspired this post.

Notice the term Medicaid not Medicare. A majority of Americans still don't know the difference. As a reminder

• Medicare refers to "medical" "care"


• Medicaid is another word for "welfare"

Generally speaking, Medicare is for people like me. People 65 and older. And no, that does apply to any other family members. Children (should there be any at this late point in life) and spouses not yet 65 years old will have to wait their turn.

Medicaid, however, is about financial AID. The word was coined because medical care is the most pressing need for poor people. That's also where "food stamps" originated, although actual stamps are no longer issued, having been replaced by prepaid debit cards. I haven't looked into the history of the word, but my guess would be that when emergency medical treatment for anyone who came to a hospital emergency room became mandatory, hospital administrators and insurance companies looked to state and federal governments to help foot the bills.

What is more mindless than charging co-pays to people who are already card-carrying poor?

Penalties other than medical expenses for being poor are easily dismissed. As old people who cannot afford proper dental care lose their teeth, they can switch to baby food. Younger poor people have always been resourceful enough to pool resources or turn to the black-market to make ends meet. But when actual expensive professional goods and services are called for, those interests are looked after by representative politics. With the passing of time became clear that the medical problems revealed by helping poor people with medical expenses was the tip of a very large iceberg. Hence Madicaid = Welfare.

?000?

I'm not going to insult the reader with any conclusions. I have to get ready for an assignment now and my time is limited. Others are free to disagree, but I am of the opinion that co-pays are a counter-productive relic of the past and should be eliminated from our practice and vocabulary. Not just for poor people but for everyone.  I very much doubt that the amounts collected even cover the administrative expense of keeping up with them, and it is now clear that they have a corrosive impact on good health.

If fears remain that too many people will get too much medical attention, then let some politician with a good imagination have the courage to have his or her staff craft a penalty mechanism, fines perhaps, for over-use, abuse and waste of needed medical resources. They can call it Cap and Trade for Sick People.