Obama Says Health Bill Will ‘Ruin’ Medicaid. Here’s Why the Program Needs Reform.
Jarrett Stepman /
The much-anticipated Senate health care bill dropped Thursday morning, and the hot takes poured in.
While analysts are scrambling to understand the details of the legislation, one of the biggest early criticisms is that it eviscerates Medicaid, which is a public health care program.
Liberal pundits and legislators reacted by saying that the bill would destroy the program.
https://twitter.com/TopherSpiro/status/877911914466000896
Senate GOP bill’s extreme Medicaid cuts would hurt Virginians & break Trump promises all to deliver a giant tax break to the wealthiest
— Tim Kaine (@timkaine) June 22, 2017
Senate #Trumpcare bill phases out Medicaid kicking millions off their healthcare while cutting taxes for the wealthy. Not just mean, cruel.
— George Takei (@GeorgeTakei) June 22, 2017
Proposed #Medicaid cuts offer a clear example. GOP bill would cut $834 billion from @MedicaidGov to fund tax break for wealthiest Americans.
— U.S. Senator Al Franken (@SenFranken) June 22, 2017
"From what is reported, in just 3 short years … Republicans will kick millions off their Medicaid coverage," Sen. Schumer says pic.twitter.com/Qyo0O7V65i
— CBS News (@CBSNews) June 22, 2017
Police drag away protesters, some in wheelchairs, chanting “no cuts to Medicaid!” outside Mitch McConnell's office pic.twitter.com/eQ4CehsDdX
— Bradd Jaffy (@BraddJaffy) June 22, 2017
Even former President Barack Obama weighed in, saying the bill will “ruin Medicaid as we know it.”
Some of these statements have certainly gone too far, as the bill only limits Medicaid expansion and phases it out.
Medicaid, which was initially designed to aid specific populations—like the disabled and low-income Americans—expanded immensely under Obamacare.
Obamacare incentivized states to increase their programs by offering increased matching rates from the federal government, which brought millions of new recipients into the program. In fact, 31 states plus the District of Columbia expanded their programs since Obamacare was implemented in 2010.
Many on the left have touted this expansion as successful. The New Yorker’s John Cassidy wrote in May, “What conservative Republicans like [House Speaker Paul] Ryan dislike about Medicaid isn’t just that it’s fiscally progressive. They also dislike that it’s working.”
One of the major “successes” of the expansion touted by proponents is that it has cut costs for states.
However, as Heritage Foundation health care expert Drew Gonshorowski wrote in The Daily Signal, this came after the federal government picked up most of the tab.
Not only were these rates set to be reduced under Obamacare, but even the remaining rates in place would create a worsening problem for the already outsized federal and state budget.
A 2016 report from the Mercatus Center explained that the states failed to account for the scale of the increase in Medicaid recipients, and that the expansion “is exacerbating the already unsustainable spending trajectory of the program that has led to a significant crowd-out of other priorities—such as education and infrastructure—at the state level.”
Additionally, research has shown that Medicaid has poorly served many of its recipients and that it has failed to vastly improve public health, despite the enormous amount of resources that have been poured into it.
As a Heritage Foundation study noted:
Medicaid is a costly and unsustainable welfare entitlement program that delivers low-quality health care to many of its enrollees … Medicaid patients frequently receive inferior medical treatment, are assigned to less-skilled surgeons, receive poorer post-operative instructions, and often suffer worse outcomes for identical procedures than similar patients both with and without health insurance.
While saying that the Senate should go further by expanding states’ options to encourage additional reforms, Bob Moffit, a senior health care analyst for The Heritage Foundation, told The Daily Signal in a statement:
Overall, the Senate bill is better than Obamacare because it contains provisions to reduce insurance premiums and promote access to insurance in the short run; cut taxes; and provide major Medicaid reform that will help refocus the program to those most in need.
Nevertheless, Moffit concluded: “It is still an open question, however, whether the bill will repair enough of the damage caused by Obamacare so that the middle-class self-employed will be able to find affordable health insurance in five years.”