Unequal Treatment Confronting Racial and Ethnic Disparities in Health Care (2003) / Chapter Skim
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Racial and Ethnic Disparities in Healthcare: Issues in the Design, Structure, and Administration of Federal Healthcare Financing Programs Supported Through Direct Public Funding Sara Rosenbaum J.D. Harold and Jane Hirsh Professor, Health Law and Policy INTRODUCTION An examination of the relationship between racial disparities in healthcare and public healthcare financing may strike some as ironic, given the well-documented role that programs such as Medicare and Medicaid have played in reducing racial and ethnic disparities in healthcare access and health outcomes (Congressional Research Service, 1993; Committee on Ways and Means, 1996; Davis and Schoen, 1978; Moon, 1993; Starr, 1982; Smith, 1999; The Henry J
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665 FEDERAL HEALTHCARE FINANCING PROGRAMS the two factors. Administrative choices that adversely affect poor patients are also more likely to create problems for minority patients.
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666 UNEQUAL TREATMENT (Hawkins et al., 2000)
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667 FEDERAL HEALTHCARE FINANCING PROGRAMS private insurance, presumably because of the program's broad coverage rules and strict limits on cost sharing, discussed below (Congressional Research Service, 1993)
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669 FEDERAL HEALTHCARE FINANCING PROGRAMS disease, and certain individuals who are permitted to purchase coverage)
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670 UNEQUAL TREATMENT In a similar vein, a hallmark of Medicare from a beneficiary perspective is its free-choice-of-provider guarantee. It is probably safe to say that Medicare beneficiaries are the last remaining group of insured Americans who are given a choice with respect to how they use healthcare.
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671 FEDERAL HEALTHCARE FINANCING PROGRAMS FIGURE 1 Racial and ethnic minority Americans as a share of the elderly population: 1995–2025. SOURCE: Urban Institute analysis of the March 1998 Current Population Survey, prepared for The Henry J
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672 UNEQUAL TREATMENT Minority and non-minority individuals FIGURE 3 Poverty rates: Minority and non-minority individuals. SOURCE: Urban Institute analysis of the March 1998 Current Population Survey, prepared for The Henry J
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673 FEDERAL HEALTHCARE FINANCING PROGRAMS beneficiaries were over three times more likely to be poor and more than one-and-a-half times as likely to have low incomes overall. That year, twothirds of African-American and Latino beneficiaries were poor or near poor.
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674 UNEQUAL TREATMENT children and pregnant women regardless of family composition or disability status, and low-income Medicare beneficiaries whose poverty level incomes prevent them from either purchasing supplemental Medigap coverage or paying Medicare's premiums, deductibles and coinsurance out of pocket. Beyond these minimum coverage groups, the law gives states the option of covering literally dozens of additional eligibility groups consisting of persons who bear some relationship to the mandatory groups but who are not poor enough to qualify for coverage outright.
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675 FEDERAL HEALTHCARE FINANCING PROGRAMS In many states, agencies other than welfare agencies, such as public health agencies, public healthcare financing agencies, and social welfare agencies, are the named single state agency (Commerce Clearinghouse, 2001)
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676 UNEQUAL TREATMENT States must make provision for application at certain "outstationed" locations in addition to local welfare offices.13 If found eligible, individuals must be furnished with medical assistance with "reasonable promptness."14 This "reasonable promptness" requirement has in recent years been interpreted by courts to apply not only to evidence of coverage but to medical care itself.15 Because Medicaid creates an individual legal entitlement in eligible persons, the law conditions the denial, reduction or termination of benefits and coverage on compliance with relatively rigorous due process requirements (Rosenblatt et al., 1997; 2001)
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677 FEDERAL HEALTHCARE FINANCING PROGRAMS In recent years, this so-called "freedom of choice" guarantee has been significantly curtailed. Since 1997, states have been given the express design option of requiring enrollment in some form of managed care arrangement as a condition of coverage for most beneficiaries.17 As of 2000, total Medicaid enrollment in managed care stood at 18.8 million persons, 55.8% of the Medicaid population and a 40% increase since 1996 (HCFA, 2000)
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678 UNEQUAL TREATMENT long-term care financing pressures that have dominated Medicaid for decades, states that maintain limited programs with only modest adoption of coverage options have tended to adopt those options that relate to the provision of long-term institutional care, rather than the coverage options that are designed to extend access to community residents. States also have broad flexibility in the area of coverage design, at least in the case of adults.
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679 FEDERAL HEALTHCARE FINANCING PROGRAMS 100% 45% 54% 55% 69% 79% P riv a te /O t h e r 50% M e d ic a id 19% U n in s u re d 19% 22% 9% 8% 36% 27% 23% 22% 14% 0% W h it e , n o n - Af r ic a n Am e r ic a n L a t in o As ia n /P a c if ic N a t iv e Am e r ic a n H is p a n ic Is la n d e r FIGURE 5 Health insurance status, by race and ethnicity, 1997: Total Nonelderly Population. SOURCE: Urban Institute analysis of the March 1998 Current Population Survey, prepared for The Henry J
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680 UNEQUAL TREATMENT 100% 26% 27% 32% 39% 46% 29% P riv a te /O t h e r 36% M e d ic a id 50% 39% 27% 25% U n in s u re d 45% 37% 34% 29% 29% 0% W h it e , n o n - Af r ic a n Am e r ic a n L a t in o As ia n /P a c if ic N a t iv e A m e r ic a n H is p a n ic Is la n d e r FIGURE 6 Health insurance status, by race and ethnicity, 1997: Low-income nonelderly population. Low-income is defined as 200% below the federal poverty level.
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681 FEDERAL HEALTHCARE FINANCING PROGRAMS to establish separate programs that operate directly under the authority of the SCHIP statute, which in structural design bears only passing resemblance to Medicaid. States have near total discretion over the benefits they furnish and the manner in which they furnish coverage.
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682 UNEQUAL TREATMENT mission or omission in Medicare and Medicaid.24 Nonetheless, even a passing acquaintance with the realities of the health system and the dynamics of healthcare allows one to hypothesize regarding the types of administration practices that could potentially contribute to the problem of disparities. The systemic choices reviewed here are ones that arise from the administration of existing programs rather than from their basic legislative framework.
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683 FEDERAL HEALTHCARE FINANCING PROGRAMS 1. Medicare conditions of participation applicable to physicians and their impact on low-income Medicare beneficiaries Federal Medicare regulations permit Medicare-participating physicians to select their patients at will.
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684 UNEQUAL TREATMENT ticipate in both programs could be assured that Medicaid would cover at least those deductibles and coinsurance requirements imposed under Medicare (i.e., that Medicaid would pay up to the Medicare payment rate)
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685 FEDERAL HEALTHCARE FINANCING PROGRAMS setting demands.27 To the extent that a committed sponsor relationship is lacking, so too might be the aggressive advocacy integral to better ensuring that complex treatments ultimately are judged to be medically necessary and appropriate under prospective and concurrent review. In sum, in a world in which successful navigation of utilization review acts as a precondition to access to highly specialized in-patient procedures, patients without committed sponsors may fare less well in the utilization review process.
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686 UNEQUAL TREATMENT they design their plans. A state can extend Medicaid to the entire lowincome population regardless of disability, age, work status, or the presence of dependent children.
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687 FEDERAL HEALTHCARE FINANCING PROGRAMS ers, persons in need of assistance with insurance (and who does not need assistance with insurance costs today?
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688 UNEQUAL TREATMENT tients remain significant matters within the provider community, grossly low payment rates offer a ready-made excuse for non-participation that rests entirely on neutral economic grounds. This excuse is particularly available to urban healthcare providers who are plentiful in number to the point of saturation in more affluent communities.
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689 FEDERAL HEALTHCARE FINANCING PROGRAMS poverty urban census tracts were members of these racial and ethnic groups. These statistics underscore the particularly serious impact that provider non-participation in Medicaid and depressed Medicaid payment levels potentially could have on minority beneficiaries' access to care.
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690 UNEQUAL TREATMENT underway, but several issues are becoming apparent. First, in many states with separate programs, the SCHIP population is whiter than the Medicaid population because of racially identifiable poverty distribution.
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691 FEDERAL HEALTHCARE FINANCING PROGRAMS eas.30 But there is no affirmative obligation on the part of either providers as a condition of participation or participating states in the case of Medicaid and SCHIP to collect and analyze health data on access and utilization by race, examine health outcomes by race, examine patterns of healthcare administration that conceivably could contribute to racially identifiable outcomes, or take affirmative steps to attempt to remedy these problems through restructuring of healthcare delivery arrangements. Notably, state Medicaid programs are far ahead of the federal government in the case of managed care organizations; their contracts with managed care organizations typically contain extensive access requirements related not only to networks but to hours, locations of services, cultural competency and translation services, and other steps designed to remove barriers that disproportionately could affect minority enrollment and utilization (Rosenbaum et al., 1997; 1998; 1999a)
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692 UNEQUAL TREATMENT managed care organizations that subdivide members based on sponsorship status) has been the subject of both speculation and actual legal challenges (Rosenbaum et al., 2000)
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693 FEDERAL HEALTHCARE FINANCING PROGRAMS under the January 19 rule.35 One of the rules eliminated in its entirety is the regulation that explicitly prohibits discrimination against Medicaid beneficiaries. The implicit message sent by the repeal of this express antidiscrimination provision is that while general compliance with civil rights laws remains a requirement,36 contractually sanctioned discrimination based on payer status is no longer specifically prohibited.
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694 UNEQUAL TREATMENT participating providers reveals that little has been done to make affirmative use of this vast purchasing leverage to both promote and finance customization of the healthcare to better meet the needs of minority patients and blunt or minimize prejudicial attitudes. Indeed, if anything, stigmatizing enrollment arrangements and dramatically low payment levels have not only tacitly sanctioned provider and system aversion but have affirmatively encouraged the rejection of lower income patients.
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695 FEDERAL HEALTHCARE FINANCING PROGRAMS recent dust-up over the Office for Civil Rights Limited English Proficiency Guidelines, when dozens of prominent provider groups in April 2001 joined together to actively protest to the White House the application of these guidelines to healthcare. It is true that much has changed since 1965.
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696 UNEQUAL TREATMENT Above all is the refusal of providers to participate in Medicaid in the case of low-income Medicare beneficiaries and the tendency of separately administered state SCHIP programs to segregate white, near-poor children from minority poor children in access and coverage. Both of these practices, as well as the practice of permitting Medicaid managed care plans to treat enrollees through separate networks, appear to directly countenance a form of payer segregation that comes close, at least in principle, to segregated waiting rooms and hospital wings.
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697 FEDERAL HEALTHCARE FINANCING PROGRAMS Health Care Financing Administration (HCFA)
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698 UNEQUAL TREATMENT U.S. Commission on Civil Rights.
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