Of the 20 million newly insured under the Affordable Care Act in 2017, about 14.5 million were newly enrolled in Medicaid, nearly 5 million of whom were eligible but not enrolled before the Medicaid expansion. So Medicaid accounts for a large portion of ACA’s claimed effect of increasing the number of insured.
Medicaid is not “insurance that can never be taken away.” People lose eligibility if their income increases. The huge “Medicaid cliff” is a serious disincentive to work, and a poverty trap.
The federal government is spending $410 billion on Medicaid this year. Together with the cost to the states, the program will exceed $550 billion. That is almost as large as the military budget. Medicaid consumes about 20 percent of states’ general funds.
Beneficiaries of the Medicaid expansion include:
- Managed-care giants who contract with Medicaid, whose profits have tripled
- Politically connected hospitals, which were able to dramatically increase amounts collected from private payers in Arizona, and which banked windfall profits in Oregon
- Entities that bleed money from the program at all levels (compliance departments, utilization reviewers, other state agencies)
How much more medical care did people receive? This is not known and very difficult if not impossible to determine. There is a lot of incentive to obscure the answer, and for states to game the system to get more federal dollars. There is even a new verb, “to medicaid.”
Outcomes were no better, as experience in Oregon showed.
Questions for candidates:
- Should Medicaid programs be audited as a condition of obtaining funding?
- Should Medicaid funding be block-granted to states, with permission to innovate?
- Should Medicaid be reformed to give funding directly to beneficiaries (e.g. in a medical savings account) or to pay directly for services rendered without funneling money through a third party?
- Should Medicaid reimbursements be publicly posted?
