The Affordable Care Act extended Medicaid to all Americans earning under 138 percent of the federal poverty line — $16,643 for a single person and $33,948 for a family of four in 2017. (Some states never did expand Medicaid). I doubt that a family of four earning the above or less can afford to pay for much in the way of health insurance or health care, so does this expansion seem unreasonable?
The problem as Republicans see it is that this is an open ended cost. There are no limits on Medicaid spending much like Medicare Part B which also has no limits on spending.
What to do? Well the Republican solution is block grants to fund Medicaid, but the twist is that the increase in those grants is limited and not open ended. That means it converts from a defined benefit approach to a defined contribution approach that is unlikely to keep up with health care spending. THIS IS THE SAME APPROACH MANY EMPLOYERS HAVE USED IN RECENT YEARS TO CONTROL THEIR HEALTH CARE SPENDING. Interestingly, countries with single-payer systems also set budgets for what they will spend on health care and take steps to limit that spending.
Obviously this means that either states must come up with more funding for Medicaid or there will be forms of rationing for Medicaid patients.
While nobody likes either possibility, are we saying as a society that we want health care at any cost, no limits on any spending? It’s a lousy choice I admit.
Today we are are talking about Medicaid and then it will be exchange plan tax credits and next it will be Medicare UNLESS SOCIETY DECIDES IT WANTS NO LIMITS ON HEALTH CARE SPENDING.