Medicaid has become the latest political football to be kicked around. The liberal media is complicit in promulgating the lie that Republicans are out to take Medicaid away from poor people with starving babies. These scare tactics obfuscate the truth, which is exactly what Democrats want to achieve.
They are responsible for expanding Medicaid far beyond its original intention and even farther beyond what Congress approved when the Democrats passed the Affordable Care Act (ObamaCare) in 2010. I have written about this in recent posts including Medicaid Costs Out of Control – Parts I, II, and III.
It’s time to reform Medicaid to rein in the spending which has driven the cost of Medicaid to nearly $900 Billion, outpacing even defense spending. But reforming Medicaid will not be for the timid. It will require determination and a willingness to fight back against the lies that will be told and the fake atrocities that will be prophesied.
Paul Winfree and Brian Blasé, writing in The Wall Street Journal, tell us there’s a lot at stake. They say, “Congress has an opportunity to reform Medicaid, the nation’s third-largest, and most flawed, entitlement program. Done right, reform could protect the vulnerable, promote private coverage and save hundreds of billions of dollars. Done wrong, it won’t reduce federal spending and will hurt Republicans at the ballot box by making more voters dependent on government welfare.”
They tell us Medicaid’s financing is fundamentally broken. Because of ObamaCare, the federal government pays $9 for every $1 of state spending on able-bodied working-age adults, compared with roughly $1.33 for pregnant women and disabled children. That incentive pushes states to favor healthy adults over the vulnerable in enrollment and access to providers and better services.
States also use mechanisms such as the Medicaid provider tax to distort federal-state fiscal responsibility. States tax hospitals and insurers, then use that revenue to increase Medicaid payments back to the same entities. These inflated payments trigger higher federal matching funds. The result: States recycle money through the system and extract substantial federal money with little real state contribution.
Medicaid isn’t merely a federal health program. It’s also a political machine. Studies show Medicaid enrollment boosts voter turnout, especially in Democratic areas. Enrolling in Medicaid traps recipients in a welfare program, links them to nonprofits offering voter registration, and places them squarely in the sights of campaigns’ get-out-the-vote efforts. Leftists are so reliant on welfare spending for electoral success that they oppose policies that lift people out of poverty. Expanding Medicaid using federal funds—even to noncitizens through creative financing—can have significant political consequences that Republicans shouldn’t underestimate.
The authors say Congressional Republicans should tackle the core reasons for Medicaid’s growth. They should start by eliminating Medicaid’s discrimination against the most vulnerable and lowering ObamaCare’s 90% reimbursement rate for able-bodied adults. Then they should follow Joe Biden’s advice and eliminate the Medicaid provider-tax scam. These reforms would generate significant savings that could be redirected to vulnerable patients or rural providers.
They say if Congress doesn’t enact these structural reforms, the Medicaid-industrial complex will collude with the states for richer payments funded through higher debt, inflation and taxes. In some states, Medicaid payments to hospitals now approach or exceed twice the Medicare rate, which could threaten seniors’ care. And without reform, states will continue to prioritize healthy working-age adults ahead of children and the disabled. Meanwhile, Republicans will have missed an opportunity to restore Medicaid’s core mission: providing a safety net for the vulnerable, not corporate welfare for the healthcare industry.
The authors say, “Republicans who ran on reining in Washington’s excesses and defending the needy shouldn’t preserve Medicaid’s financing inequities and money-laundering schemes. Fix the incentives now or watch federal spending—and Democratic turnout—soar on the back of a program conservatives failed to reform when they had the chance.”
This explains why Democrats are howling so much about any proposed cuts to Medicaid spending. They’re not worried about the poor needing healthcare as much as they are worried about the impact on Democratic voter turnout.