As a subscriber to xpostfactoid, I’ve entry to some glorious commentary by Andrew Spung. This isn’t an individual I might argue with in regards to the ACA, Medicare or Medicaid, and so forth. Anyway, the WSJ has an article touting Medicaid cuts which did catch his consideration and is the idea for his commentary. The hyperlink is there in case you want to learn what the WSJ Editorial Board needed to say about Medicaid.
Additionally the Medicaid cuts are what the Republicans wish to use to fund tax breaks. The poor and people who can’t afford insurance coverage or healthcare? Properly, that’s there drawback.
In actuality, pink state politicians made it tough to achieve Medicaid of their states, Some states (10?) didn’t increase protection to which the Federal Authorities paid 90% of value. The low-income enlargement is increased than what’s paid for different Medicaid enrollees. The concern is the Federal authorities would again out of the aiding states. As you possibly can see the Republican is utilizing Medicaid cuts to fund tax breaks for the higher revenue brackets.
Andrew’s takedown of the WSJ.
The WSJ’s weak case for large Medicaid cuts
Andrew Sprung: “Federal ‘cost per resident’ is not a case for cuts unless you want to double the uninsured population.”
Offering ideological cowl for Republicans who search to chop lots of of billions of {dollars} out of federal Medicaid funding, the Wall Road Journal editorial board would have you ever consider that federal Medicaid spending is uncontrolled, that wealthy states get greater than their justifiable share of federal Medicaid funding, that cuts to the projected spending development charge below present legislation usually are not cuts, and that Medicaid isn’t a lot price having anyway. That’s all false after all.
Let’s have a look at these nostrums one after the other.
Undue spending in Medicaid development. The WSJ editorialists write:
Medicaid spending as a share of federal outlays rose to 10% from 7% between 2007 and 2023, whereas the share of Social Safety and Medicare remained steady.
Properly sure, after all. The ACA Medicaid enlargement, rendered optionally available by the Supreme Court docket in 2012, provided Medicaid eligibility to all lawfully current U.S. adults with revenue as much as 138% of the Federal Poverty Degree, excepting these topic to a federal 5-year bar on new immigrants. As of this system’s full launch in 2014, 24 states had enacted the enlargement, and as of now, 40 states plus D.C. have accomplished so. Medicaid enrollment has accordingly grown by 38% since 2013 (and had swelled even increased as of 2023, the yr cited by the Journal, on account of the pandemic-induced three-year moratorium on disenrollments. Medicaid enrollment has dropped 17% for the reason that 2023 peak.)
Democratic states seize greater than their justifiable share of federal largesse. We’re requested to consider:
Democratic-run states obtain disproportionately extra federal Medicaid {dollars}. New York obtained $3,046 for every state resident in 2023 primarily based on the latest federal information. Federal Medicaid {dollars} additionally subsidize California ($2,167 per resident) and Illinois ($1,715) far more than Florida ($991) and Texas ($1,239).
Now this one is simply foolish. Blue states obtain extra “per resident” as a result of they enacted the ACA Medicaid enlargement and thereby enrolled a far bigger proportion of their inhabitants than the dwindling set of “nonexpansion” states which have chosen as a substitute to maintain their uninsured charge at double that of peer enlargement states. Kentucky, with a inhabitants of 4.6 million, drew $13.5 billion in federal Medicaid {dollars} in 2023 — about $2,800 per resident. Arizona, inhabitants 7.6 million, obtained $18.1 billion in federal Medicaid funding in 2023 — $2,500 per resident, greater than New York.
Whereas the 90% FMAP for the ACA enlargement inhabitants closes the funding hole considerably between wealthy states and poor states — the latter have a better FMAP for all different Medicaid enrollment classes — the wealthy and blue states don’t obtain a disproportionate quantity of federal {dollars}. Some, notably New York, do have increased per-enrollee prices than the nationwide common — as do some low-income states, together with Mississippi, the state with the bottom per capita revenue.
The desk beneath exhibits federal {dollars} per enrollee for the states cited by the WSJ above, together with West Virginia, a low-income state that has expanded Medicaid, and Mississippi, a low-income state that hasn’t. As enrollment was inflated by the pandemic moratorium in 2023, I’ve included totals from March 2023 and likewise October 2024, the final month out there, so as to add perspective. Additionally proven are the share of the state inhabitants coated by Medicaid and the state uninsured charge in 2023, the final yr out there. CHIP enrollment will not be included, as MEDPAC doesn’t embody CHIP within the spending desk on which I’ve constructed (sources at backside).
States which have accepted the ACA Medicaid enlargement are marked in yellow.
Medicaid Spending and Enrollment in Choose States, 2023 and 2024, with Uninsured Fee
Sources:
Federal/state Medicaid spending: MACPAC
Inhabitants by state: Census Bureau
Medicaid enrollment (3/23 and 10/24): CMS Month-to-month Studies
Uninsured charge: KFF
Word that the share of the overall inhabitants in Medicaid within the enlargement states is roughly double that of the nonexpansion states, whereas the uninsured charge is roughly double within the nonexpansion states. Word additionally that whereas spending per enrollee could be very low in Florida and really excessive in New York, it’s not notably low in Texas (which enrolls so few people who many have to be in acute want) or notably excessive in California or Illinois. The price of care varies significantly in several areas of the nation, as does the combo of Medicaid enrollees and the advantages provided.
Foolish as it’s, the WSJ’s per-resident spending measure additionally ignores the truth that Florida and Texas have partially compensated for his or her refusal to increase Medicaid with speedy enrollment development at low incomes within the ACA private-plan market. In 2024, Florida, inhabitants 23.3 million, had a median of about 4 million backed market enrollees per thirty days* receiving a median premium subsidy of $568 per thirty days, whereas California, inhabitants 39.4 million, had about 1.6 million common month-to-month backed enrollees receiving a median of $526 per thirty days. That’s, “per resident,” Florida collected about $1,173 in federal subsidies, whereas California drew about $250.
Sources: Census Bureau, CMS Effectuated Enrollment Snapshots; CMS ACA Market Enrollment Public Use Recordsdata
Cuts usually are not cuts. The WSJ editorialists claims that the $880 billion Republicans may minimize from CBO’s 10-year projections of Medicaid spending will not be a minimize as a result of spending would develop in absolute greenback phrases.
That’s additionally foolish — a perpetual Republican speaking level to justify savage proposed cuts. Inhabitants grows, inflation is inevitable, and medical inflation often exceeds general inflation — although per-enrollee spending development in Medicaid has been far slower over time than in some other kind of U.S. well being protection. Oh, and emergencies such because the COVID-19 pandemic occur — and can all however actually occur once more. Thanks primarily to Medicaid, the uninsured charge barely budged when 20 million individuals misplaced their jobs in spring 2020, whereas Medicaid enrollment soared by some 20 million earlier than falling again in the course of the unwinding of 2023-24. Per capita caps on the federal Medicaid contribution, the most important single Medicaid minimize on the Republican menu (although disavowed for the second by Johnson), would strangle this system over time.
Whereas flawed and chronically underfunded, Medicaid is a significant contributor to the nationwide welfare. Contemplate:
- Medicaid controls prices: From 2008-2023, per-enrollee spending grew by 80.4% in non-public insurance coverage, 50.3% in Medicare, and 30.3% in Medicaid, in response to a KFF evaluation of Nationwide Well being Expenditure information.
- The federal contribution is increased for low-income than high-income states: in truth, the federal matching charge (FMAP) varies instantly in response to state per capita revenue. For FY 2026, FMAPs vary from 76.9% for Mississippi to 50% for California, New York and different rich states. Whereas rich states typically profit from the 90% FMAP for the ACA Medicaid expansions, so do many low-income states (40 stats plus D.C. have expanded Medicaid thus far).
- The ACA Medicaid enlargement minimize the uninsured charge nationally by about 40%. From July 2013 to October 2024, Medicaid enrollment elevated by virtually 23 million. From 2013 to 2023, the nationwide uninsured charge dropped from 14.6% to 7.9%, mainly on account of the enlargement.
- Medicaid enrollees are barely extra happy with their protection than enrollees in employer-sponsored insurance coverage, with 82% ranking their protection glorious or good in response to a KFF survey.
To borrow a well timed set of hyperlinks from Matthew Yglesias: numerous research present that Medicaid enrollment has “a meaningful impact on mortality, as well as long-term better economic outcomes for covered kids [see also here] and reductions in crime” — in addition to a constructive influence on employment amongst these with disabilities.
Since Trump blithely promised to not minimize Medicaid whereas endorsing the Republican Home finances decision that requires a minimum of $650-880 billion in cuts to this system, Republicans are tuning their guitars to say that they’re not chopping advantages, solely waste and fraud. The Paragon Institute will lead the cost with an array of deceptive claims — e.g. that CMS’s accounting of the “improper payment rate” in Medicaid (which is decrease than the speed in Medicare) could be construed as a measure of fraud, whereas it principally flags insufficient documentation. Extra subtle ideological cowl for cuts than the WSJ’s are forthcoming. I hope the nice students at CBPP, the Georgetown Middle for Youngsters and Households, KFF, Brookings, CAP, and all through academia are prepared for the onslaught.
*Common month-to-month enrollment figures for the ACA market in 2024 usually are not but revealed, so I used effectuated enrollment as of February. In 2023, common month-to-month enrollment exceeded February effectuated enrollment, pushed by the Medicaid unwinding, which was additionally in progress via about half of 2024.
