With Congress moving towards a repeal and replacement for Obamacare, it is no surprise that the law’s advocates are concerned about their Washington-centered approach to health care being scrapped.
It was alarming, however, to see former congressman Henry Waxman take up his pen to decry potential reforms to the Medicaid program — especially since the policies he criticized were ones he once supported.
Waxman said it would be “an unprecedented abandonment of federal responsibility” that would “pass the buck to the states” and “deny care to the most vulnerable among us.” He claimed that “imposing a per-capita cap or block grant would rip health-care coverage from the most vulnerable” and “dramatically shift the burden” of costs to the states. It is true that this change would significantly change Medicaid’s financing, but Waxman’s critique of adopting a per-capita cap rings hollow.
The basic architecture of Medicaid has remained largely unchanged over the past 50 years.
We now have an opportunity to improve and modernize the program so it remains strong for the next 50 years.
In the meantime, Democratic attempts to score political points by manufacturing fear of per-capita cap reforms not only are misguided, they are hypocritical.
After the Senate released its own version of the ObamaCare repeal bill, now known as the Better Care Reconciliation Act, the media quickly pounced with a now-routine talking point: the Republican bill will slash Medicaid! People will die from deep cutsto Medicaid! Medicaid as we know it will be destroyed!
These attacks are misleading at best, and deliberate fear-mongering at worst. The GOP healthcare bill does not cut, destroy, slash, or ‘any-other-scary-verb’ Medicaid. Just look for yourself. The top line numbers from the CBO don’t lie.
Under current law – that is, ObamaCare – Medicaid spending is expected to spiral from $393 billion this year to $624 billion in 2026. That’s nearly a 50% increase for a program that is already a budget-buster and is growing far faster than the U.S. economy and our national debt can manage.
In contrast, under the GOP’s healthcare bill, Medicaid spending is still expected to increase from $393 billion this year to $464 billion in 2026. That’s an 18% increase, but it’s more in line with regular economic growth and inflation. The below chart from the CBO comparing the two laws makes the trend pretty clear.
The BCRA actually increases Medicaid spending relative to today, while curbing the projected unsustainable growth line in the future – that is, dollars that have not yet been spent.
Only to Democrats is increased spending on a federal program considered a cut.
The reduced cost curve in the GOP plan – remember, spending is still increasing – would come from significant changes in how the federal government reimburses the states for their Medicaid spending, as well as more flexibility in how states can manage their programs. The bill also phases out the Medicaid expansion that ObamaCare exclusively funded – which means that the CBO’s estimates on decreased Medicaid enrollment compared to current law consider Americans who might have someday in the futurebeen covered by Medicaid.
One government study found that the majority of Medicaid recipients stay on the program for less than 36 months. A third stay enrolled for less than a year. Keeping Medicaid’s funding structure sustainable – not simply creating more open-ended financial commitments while enrolling millions of new otherwise able-bodied patients – is crucial to guaranteeing the safety net is there for those who are most vulnerable.
Medicaid reform is long overdue (these ideas were popular among Democrats in the 1990s) and the GOP bill takes steps to actually address the program’s flaws while keeping it on a fiscally sound growth path. Medicaid spending will still be increasing.
But that won’t stop the left from talking about “cuts.”
Working together with governors and state Medicaid reformers, we can empower states with new statutory flexibilities. We can modernize the waiver process so states can focus on managing their programs based on the needs of their patients, not managing paperwork for the Centers for Medicare and Medicaid Services. We can create better tools and incentives for states to reduce costs, boost quality and improve health outcomes.