The Medicaid Deniers
The Left dismisses research finding that government fails to make people healthier.

Paul Krugman


Avik Roy

There were problems with the first-year Oregon data. In their research paper, the investigators noted that two-thirds of the improvement in patients’ self-reported health took place “about 1 month after [Medicaid] coverage was approved” but before the patients had seen a single doctor or consumed any health-care services. This strongly suggested that the “benefit” that patients were reporting was the insurance version of a placebo effect. But this subtlety didn’t make the front pages.

When the following July came around and it was time to publish the two-year results of the study, the Oregon investigators were strangely silent. The election came and went. The state-by-state debate on expanding Medicaid came and went. Finally, on May 1, 2013 — ten months late — The New England Journal of Medicine published the second-year findings. Did Medicaid save lives? No. It “generated no significant improvement in measured physical health outcomes,” including death, diabetes, high cholesterol, and high blood pressure.


What’s almost as striking as this non-result is how few Oregonians felt the need to sign up for this allegedly “life-saving” program. The authors report that, of the 35,169 individuals who “won” the lottery to enroll in Medicaid, only 60 percent actually bothered to fill out the application. In the end, only half of those who applied ended up enrolling. Remember that this is a program on which we will be spending $7.4 trillion over the next ten years, a program that Obamacare throws 11 to 17 million more Americans into, because of the hundreds of thousands of lives that Medicaid will supposedly save.

The Medicaid spin cycle
Immediately, progressive bloggers went into overdrive to explain these results away. “The sample size was too small,” they said, even though new medicines for diabetes, high cholesterol, and high blood pressure routinely show significantly improved health outcomes in much smaller trials. “Two years isn’t long enough to show a significant benefit,” they insisted, even though new drugs that failed to show any benefit in two years would be summarily rejected by the FDA and abandoned by their sponsors.

The Medicaid cohort reported that they felt better about their health and their financial security as a result of enrolling in the program, and were less depressed. We can presume that the 40 percent of Medicaid “winners” who didn’t bother to fill out the application felt differently; they, however, were not surveyed.

Nonetheless, lefties seized on this qualified bit of good news. “This is an astounding finding . . . a huge improvement in mental health,” said Gruber. To which Ben Domenech responded, “I wonder whether we’d be better off replacing the [Medicaid] expansion with a program which hands out $500 in cold hard cash and a free puppy.”

Kevin Drum of Mother Jones, in a wince-inducing post, insisted that it was “flatly not true” that Medicaid didn’t improve health; he cited positive numerical trends on some health measures that were just as likely the product of statistical noise.

Austin Frakt of Boston University is a passionate Medicaid advocate who, for years, has disputed studies showing poor Medicaid outcomes. “That insurance . . . improves health and reduces mortality risk is as close to an incontrovertible truth as one can find in social science,” Frakt averred in 2010. Frakt held up the Oregon study as the gold standard for health-policy research. Now that its results are out, he has gone in both directions: He simultaneously insists that the Oregon study was “far too small” and highlights any encouraging sign he can unearth, downplaying all the reasons the study was biased in Medicaid’s favor.

Paul Krugman, the Medicaid-denier-in-chief, recycled the lefty-blogger talking points and then issued this classic: “If health insurance is a good idea — and you are nuts if you let this study persuade you otherwise — Medicaid is cheaper than private insurance. So where is the downside?” Oh, I don’t know. Maybe $7.4 trillion?

After that gambit didn’t take, Krugman abruptly shifted gears, arguing that Medicaid’s health outcomes don’t matter. “Fire insurance is worthless!” he snarked. “After all, there’s no evidence that it prevents fires.”