States Best Response to Health Reform: Drop Medicaid

Medicaid-eligible families could then get insurance from the newly created health insurance exchanges — reaping a subsidy worth more than $19,000 a year.  The state would have to assure the full cost of long-term care, however.

Edmund Haislmaier, senior research fellow at the Heritage Foundation… estimates that Texas would save $46.5 billion from 2014 to 2019 under this model. In all, Mr. Haislmaier said, 40 states would come out ahead financially.

Full article on dropping Medicaid in Texas.

Comments (10)

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  1. Tom H. says:

    I think this is a no brainer.

  2. Ken says:

    I agree with Tom. Medicaid eligible people could go into the exchange and get a $15,000 health plan plus reimbursement for out-of-pocket costs equal to, say, another $4,000. If these are comparable to Blue Cross plans, hospitals won’t have to worry about bad debts and they can easily survive their loss of DISPRO money.

  3. Vicki says:

    We would be doing poor families a great favor by letting them migrate from Medicaid to private insurance.

  4. Ken says:

    HHS is upset about this. See Marilyn Serafini’s piece for Kaiser

  5. Erik says:

    CHIPRA already allows any family who is eligible for Medicaid/SCHIP (Health Families in CA) to take that subsidy and apply it to a group insurance plan where they work.

    This is just smoke to cover the Republican attempt to disband PPACA by eliminating a safety net program for the poor.

  6. Linda Gorman says:

    Erik, the states are looking at real numbers, not smokescreens. Several smaller states have hired Milliman to estimate the cost of the required ObamaCare expansions. The estimates all came in around a billion dollars in extra money from the states (with more than that from the feds) for FFY 2010 to FFY 2019.

    These estimates do not include changes in physician fee schedules mandated by ObamaCare, pharmacy rebate modifications (worth $138 million in South Carolina), changes in the Part D benefit, or the fact that new enrollees may have higher costs during the first few years.

    South Carolina state general fund spending on Medicaid is in the neighborhood of $1 billion a year so this kind of increase represents serious money. The Heritage estimates that states can still save a bundle even if they continue to provide support for those who are on Medicaid because they are disabled.

    Pulling out of Medicaid and SCHIP might also make individual citizens better off. They will be able to access federal subsidies to purchase private insurance. Private insurance is more convenient and offers more access to actual medical care than Medicaid.

  7. Paul H. says:

    I think Erik’Statement about CHIPRA is not complete. If a Medicaid enrollee wants to enroll instead in an employer plan, I believe the employer plan has to cover all the (on paper) benefits and no more copayment or deductible than Medicaid would charge.

    If the private plan doesn’t do all these things then it is deemed “inferior” to Medicaid, even though I have never met anyone who would be willing to trade in his private insurance for Medicaid.

    Erik, is this what you mean by a safety net?

  8. Virginia says:

    When times are tough, states have got to make choices.

  9. Devon Herrick says:

    States that attempted to maximize federal matching funds by expanding their Medicaid programs are now finding they made a poor bargain. New York will especially be hard-hit when it has to increase provider rates by a factor of three to get enough doctors willing to treat Medicaid patients after the expansion.

  10. Yash says:

    If you are poor or “low income” and can’t afrfod a basic need (health insurance) for YOURSELF, then you certainly can’t afrfod it–or anything else, like food, shelter, etc–for a CHILD. Duh. The government is trying to limit the number of people sponging off us taxpayers, not increase it..