• Room for Debate: Saving Medicaid

    I’m a participant in today’s Room for Debate discussion on the NY Times website. The topic is Medicaid, how it is financed, and whether we could or should reduce its price tag. I credit Steve Pizer with helping me get my thoughts straight about what I could convey on this topic in fewer than the 300 words I was permitted. I end my piece with,

    The deficit is a serious long-run problem, and reducing the rate of growth of health care costs is the foundation of any real solution. But Medicaid already pays the lowest prices and has tight utilization controls in place. Further clamping down on prices paid will cause providers to pull out of the program, bankrupt hospitals, and make it even harder for sick and poor individuals to find care. Reducing eligibility would throw more families into crisis.

    There is plenty of waste and inefficiency in health care, but most of it is found in private insurance and Medicare, not in Medicaid.

    There’s obviously a lot more that one might say about Medicaid than I did, and other discussion participants did so (though several reinforced my position). The other participants are:

    • Kerry Weems, former Medicaid administator
    • Judy Solomon, Center on Budget and Policy Priorities
    • Merrill Matthews, Institute for Policy Innovation
    • Matthew Mitchell, George Mason University
    • Harold Pollack, University of Chicago

    Check it out in full.

    • Austin
      Two issues on your comments:

      1) Medicaid crowd out: I have read many times that phenomena is overstated.

      2) Medicaid waste is less prevalent? If you eliminate pregnancy and long term care (former cheap, latter another issue entirely), and examine Medicaid expenditures within the duals and disabled, is this true? Granted, some Medicare confounding in that bucket, but that is the bucket where much of the medical expense occurs.


      • @Brad F – Re your 1: You will be rewarded for continuing to follow the blog for many months. One day my paper on that will appear.

        Re 2: What is “waste?” Once you define it, is there any reason to believe it isn’t vastly higher in Medicare and/or the commercial market?

        Look, we just gave away another ~$50 billion to private Medicare plans to provide additional benefits of very low marginal value. Meanwhile, for want of a few million Medicaid enrollees in AZ are dying.

        Even if you can find some “waste” in Medicaid, I’d rather save a few billion on spending for those with pretty good coverage already than a few million for the most needy.

        Medicaid is mostly a political and funding system problem (which we should address!), not a major player in the systemic health spending problem.