Cuts to Medicaid hurt all kids, rich and poor


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Cuts to Medicaid hurt all children — rich and poor. Because hospitals that deal with serious childhood injuries and illnesses depend on the public funding as much as those poor families who get medical care under the government insurance program.

That’s the message that Stanford Health Policy’s Lisa Chamberlain, Olga Saynina and Paul Wise and will be presenting at the Pediatric Academic Societies meeting in Toronto later this week. The PAS conference is the leading event for academic pediatrics and child health research. Chamberlain and Wise are Stanford Medicine pediatricians and Saynina is a data research analyst with Stanford Health Policy.

New research by the Stanford team shows that proposals to dramatically reduce federal expenditures on Medicaid and CHIP — the Children’s Health Insurance Program — could destabilize current specialty care referral networks for all children. This includes a large subset of privately-insured children in greatest need of high quality, specialized pediatric care.

“Most people think of Medicaid as a safety-net program, and to a certain extent it is,” said Wise, a core faculty member at SHP and the Center on Democracy, Development, and the Rule of Law, as well as a senior fellow at the Freeman Spogli Institute for International Health.

“But it has become so important to child-health systems that rich kids — kids with good commercial insurance — are heavily dependent on specialized care if they really get sick, on facilities that are heavily dependent on Medicaid,” he said.



Nearly one out of every five children live below the poverty line, according to the U.S. Census Bureau, yet few children need extensive health care. But of those who do, about 44 percent rely on Medicaid or other public insurance programs, regardless of their family’s income.

“Caring for seriously ill children requires a wide range of services and specialists, from pediatric surgeons to speech therapists to hospital teachers who make sure kids don’t fall behind,” Chamberlain told SHP for this story last year. “In pediatrics, we work as a team — and cutting Medicaid will reduce our ability to do that.”

The Stanford group analyzed two large datasets: the 2012 national Kids’ Inpatient Databaseand the 2012 California Patient Discharge Database. They found that hospitals caring for children with serious, chronic illnesses — such as congenital heart disease, cancer and severe asthma — are highly dependent on public payers such as Medicaid.

Nationally, major pediatric hospitals reported 55 percent of bed-days were covered by public payers, with the 10-highest volume hospitals ranging from 36 to 100 percent.   Overall, in California for all hospitals, 30 percent of net revenue is derived from Medicaid and for children’s hospitals, Medicaid provides 56 percent of net revenue.