Medicaid: Why It’s So Bad and Hurting So Many

Craig Huey Government, Congress, and Politics, Healthcare 1 Comment

Medicaid is what Obamacare is becoming:

  • Inferior care
  • Long waits, even for needed surgery
  • Poor choice of doctors

Medicaid is arguably the world’s worst health insurance program.

Why?

The joint federal-state health program allows the federal government to give states 50 cents for every dollar they spent on purchasing health coverage for the poor and needy.

It has caused Medicaid to grow astronomically and is now the biggest ticket item on virtually every state budget.

It’s not only expensive, but it provides terrible coverage, too.

Obama dumped money into states so they could expand Medicaid even further.

He told states the feds would pick up 100% of the tab for the first three years for every additional person they covered (up to 138% of the poverty level).

After that, he would still pay 90% in perpetuity.

The District of Columbia and 31 states took that offer; 19 states refused.

Of the 16.6 million Americans who were covered by Obamacare between December 2013 and September 2016, 2.8 million did so via private coverage.

The balance, an incredible 13.8 million, got it through Medicaid and its companion program for children, CHIP.

One of the dirty little secrets of Obamacare is that many of its Medicaid enrollees are people kicked off their private plans due to the Medicaid expansion, so the law may have cost lives, rather than saved lives.

Medicaid now covers almost 75 million Americans. Even before Obamacare, Medicaid paid for almost half the births in America.

But can America sustain the cost?

The program’s combined annual price tag exceeds half a trillion dollars, with the feds share at 63% and the states at 37%.

That adds up to about $7,000 for every adult and child in the program.

Studies have found Medicaid patients experience no better health outcomes than uninsured patients, sometimes worse.

Because Medicaid reimburses doctors so poorly that providers literally shun recipients. This means 3 things:

  1. Medicaid patients face far longer wait times to see primary care doctors, specialists, or get surgery.
  2. Often, they end up in the emergency room just like the uninsured.
  3. And in non-emergency situations, the uninsured might in fact get better care than Medicaid patients because doctors have more flexibility to charge them market prices.

In a University of Virginia study of 893,658 patients in the university hospital, it found that individuals on Medicaid had the worst post-surgery survival rate of any patients, including the uninsured, after controlling for age, health status, income and other relevant factors.

How to fix this problem?

For starters, here are two good ideas:

  • Block grant Medicaid and give states an annual lump sum tied to inflation, basically ending the open-ended entitlement that’s burning a hole in federal and state coffers.
  • A Health Savings Account — basically a tax-free IRA — to pay for routine care and other out-of-pocket expenses. Any balance at the end of the year would roll over into the next year

The Congressional Budget Office has estimated that block grants could cut Medicaid spending by up to a third over a decade.

This would curb healthcare inflation and lower overall spending.

Meanwhile, the Senate is trying to come together with a repeal and replace to Obamacare.

As Republicans try to reach a compromise, the media has entered the fray with fake news of deep Medicaid cuts.

ABC, CBS and NBC wasted little time reporting on “the massive cuts to Medicaid.”

The Washington Post fanned the flames with its headline, “It’s Official: The Senate healthcare bill is about cutting Medicaid.”

Slate.com bellowed “Americans with Disabilities Should be Terrified,” that their “essential lifeline” of Medicaid would somehow be severed.

As the Senate leader Mitch McConnell has explained, “There is nothing in the bill that would cause anybody currently on Medicaid to be taken off Medicaid.”

If enacted, the Senate bill is estimated to cut federal Medicaid spending from $4.6 trillion to about $3.9 trillion, between 2018 and 2026.

Hardly massive cuts. Money would be saved with better efficiency through block grants to states.

Like Obamacare, Medicaid is an expensive, ineffectual entitlement program that needs to be overhauled.

Isn’t it time to fix Monster Medicare?

What do you think? Write me at [email protected]

Comments 1

  1. Your last comment refers to Medicare while your prior comments talked about Medicaid? Did you mean Medicaid in your last comment?

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