The Republican budget proposed by Rep. Paul Ryan (R-WI) would dramatically reduce access to care for millions of Americans by repealing the Affordable Care Act, turning Medicare into a “premium support” system that could make costs skyrocket, and switch the current Medicaid payment plan to a system of insufficient block grants. When it comes to Medicaid, however, not everyone is sure that budget goes far enough.
In an issue brief released last week, the conservative Heritage Foundation called for “transitioning” Americans out of Medicaid and “into more popular private health insurance options.” While the brief praised the block grant proposal from Ryan as an “important change,” it made clear that, in their view, even more action was needed:
The House Republican budget took important steps with regard to Medicaid by calling for the repeal of Obamacare and putting Medicaid on a budget. However, this is just a down payment on what needs to be done. The next—and equally as important—step is to put policies in place that restructure the Medicaid program so that low-income individuals and families are mainstreamed out of Medicaid and into the private health insurance market. In this way, Congress can expand the private insurance market, ensure more robust competition, and secure the kind of care that the vast majority of working Americans have today. At the same time, Congress needs to restore Medicaid to a true safety net program for the most vulnerable in society.
What Heritage did not say in their brief is that Medicaid actually costs less than private insurance. According to Families USA, it costs 20 percent less for Medicaid to cover lower-income Americans than private health insurance plans, which may not cover all the services those people need. And a study from the Kaiser Family Foundation released last week found that the rate of growth in Medicaid spending was actually lower than for private insurance plans.
Ryan’s block grant plan would cut federal spending on Medicaid by a third, dramatically reducing access to care and costing 14 million people access to care. If the Affordable Care Act was repealed, as Heritage and Paul Ryan both call for, the private insurers the brief suggests take over could also deny those people coverage because of a pre-existing condition. Under this plan, the “most vulnerable” Americans Heritage claims to be worried about would suffer.