In addition, some preventive investments may not yield health care savings but may instead produce savings in other areas, such as the criminal justice system. Given these externalities, the current health care financing system leads to lower investments in prevention than would occur under alternative financing arrangements.
For Medicaid-insured adolescents, reimbursement policies are not structured to support the delivery of comprehensive preventive services. Only 33 states, for example, pay for annual preventive visits for adolescents (Fox, Limb, and McManus, 2007a). Moreover, risk reduction counseling services to address such issues as family problems, sexual practices and contraceptives, and injury prevention are reimbursed in only about half of states (Fox, Limb, and McManus, 2007a). Restrictions on billing for two services on the same day are also an impediment to the delivery of comprehensive preventive services. While a billing mechanism does exist that allows a provider to be reimbursed for a well-adolescent visit and the provision of additional health counseling, only 7 Medicaid agencies expressly allow the practice, while 18 explicitly deny it (Fox, Limb, and McManus, 2007a).
Payment policies utilized by third-party payors compromise the delivery of confidential services to adolescents, even in states that have laws allowing minors to consent on their own to certain sensitive services. The managed care practice of sending documents to the primary insured party (usually a parent) undermines the ability of providers to deliver truly confidential services to adolescents and has a particularly strong impact on adolescents’ receipt of behavioral and sexual and reproductive health services (Gudeman, 2003). These documents, known as explanations of benefits (EOBs), usually detail the services delivered and any outstanding cost-sharing payment that is owed. This practice is universal among private payors and is also used by managed care companies delivering services to adolescents enrolled in Medicaid and SCHIP, even in the absence of cost-sharing requirements, as no state has included a prohibition against sending EOBs in its managed care contracts (Brindis et al., 1999).
Finding: Having health insurance does not ensure adolescents’ access to affordable, high-quality services given problems associated with high out-of-pocket cost-sharing requirements, limitations in benefit packages, and low provider reimbursement levels. For example, the current system for financing health insurance coverage leads to underinvestments in disease prevention and treatment in some areas that are particularly problematic for adolescents.