Further proof that government saves money

One of the little-noticed gems in the House version of the bill is that one of the way is saves money is by putting more people on Medicaid.  You heard me:

A previous version of the House bill carried an estimated cost of $1.04 trillion over 10 years, but House negotiators were able to lower the price tag in part by expanding Medicaid coverage to a broader slice of the population, the equivalent of all individuals who earn about $16,200 per year. The original House legislation had sought an increase to 133 percent of the federal poverty level, or about $14,400 per year, the same level proposed in the Senate bill.

The adjustment reflects findings by congressional budget analysts that covering the poor through Medicaid — which pays providers far less than Medicare — is far more cost-effective than offering subsidies for private insurance policies, something the bill would provide to middle class individuals who lack access to affordable coverage through their employers.

Medicaid costs less than private insurance.  So it actually costs us as a country less to give people Medicaid than to give people money to buy private insurance.  So…  maybe we’d save even more if we put more people on Medicaid, say up to 250% of the poverty line.  Or… maybe everyone?

And before you start screaming about Medicaid’s low levels of reimbursement, Ezra notes that the bill contains legislation to increase Medicaid’s reimbursements to Medicare levels.

Hidden information below


Email Address*