Is Our Current Insurance Model the Best Health Policy?

When the 48-year-old man from Oregon didn’t have insurance, he felt he had no place to go but the emergency room. The man, who has diabetes, went to the emergency room often when he suffered from kidney stones. “Emergency rooms, from what I understand, they can never turn you away,” he said. “I mean, you don’t have much options when you don’t have insurance.”

Then, when he enrolled in the state of Oregon’s Medicaid plan, that all changed. He started seeing doctors in their offices, and stayed away from the emergency room: “I have had five appointments with my primary, one with the diabetic because they had me go to a diabetic educator, and then an appointment with my pharmacist, and then he does a phone-in thing with me every two weeks.

His experience confirms common assumptions about how health care works. If we can just invest in preventive care, we can reduce the use of the emergency room and lower health care costs, the thinking goes. But it turns out that his experience wasn’t typical. He was part of a giant social policy experiment that randomly assigned some eligible people to get Medicaid and others to remain uninsured. Over all, the study found that people who got insurance actually used the emergency room more than their uninsured peers.

Collecting data that can trump a powerful anecdote is the value of the randomized controlled trial, says Amy Finkelstein, an M.I.T. professor and a leader of the Oregon study, which has published a series of papers, most recently on emergency room use.

That’s why this type of study — which randomly assigns some people to a new treatment and others to a placebo or an old approach — is the gold standard in evaluating the effectiveness of drugs: It can provide results that are both surprising and persuasive. But despite medical science’s long history with such studies, when it comes to the best way to design health care delivery, the randomized evaluation is still an incredibly rare approach.

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Jeffrey R. Ungvary President

Jeffrey R. Ungvary