Mitt Romney’s plan for Medicaid actually comes in two distinct parts: One, block grant the program, thus turning administration of it completely over to state governments. Two, cut the program as a share of the economy by a third over the next decade, and keep cutting after that. The plan Paul Ryan laid out for Medicaid in the latest House GOP budget is essentially identical. Romney, Ryan, and their cohorts typically defend this scheme by claiming it will open up Medicaid to greater innovation at the state level.
But, as the Huffington Post’s Jeffrey Young noted yesterday, there is a bitter self-contradiction in this argument. Romney’s cuts to Medicaid would almost certainly stifle the very state-level innovations he’s praising:
“Arizona has always been operating in the current financing and entitlement structure of Medicaid. They’re not operating the structure that Mitt Romney wants to go to,” said Joan Alker, co-executive director of the Georgetown Center for Children and Families in Washington.
In recent years, Arizona has raised co-payments and frozen enrollment for poor adults — and is weighing a request for additional federal money to preserve coverage for about 150,000 people and reopen the program to new applicants. The state also put limits on coverage of organ transplants in 2010, but rescinded the policy the following year.
Rhode Island obtained a “waiver” from federal Medicaid rules in 2009 that enabled the state to establish a cap on its spending between 2009 and 2013. The Rhode Island initiative has been hailed by conservatives as a model for future block grant programs because the state has reduced its spending. But Rhode Island implemented its Medicaid reforms with extra federal money and the savings turned out not to be as large as originally believed, according to an analysis by the Center on Budget and Policy Priorities that cites the findings of a report commissioned by Rhode Island Gov. Lincoln Chafee (I).
Ironically, the same could be true of the Massachusetts health care reform Romney himself passed into law as governor of that state. Romney negotiated an increase in the federal Medicaid funding going to Massachusetts. That money funded Commonwealth Care, a subsidized market of private coverage for people living under 300 percent of the poverty line — essentially, the Massachusetts version of Obamacare’s exchanges. John McDonough, one of the plan’s main designers, told the Boston Globe, “It would have been impossible for Massachusetts to do what it did without increased federal Medicaid support.”
Oregon is also running a reform experiment that relies on an increased contribution from the federal government. In a move hailed by conservatives, Florida is trying to expand a health care reform pilot program state-wide. An assessment by the Georgetown University Health Policy Institute determined the program was unlikely to save the state costs, suggesting a much lower level of federal funding would do the experiment no favors.
Of course, Republican lawmakers in Florida see the Romney-Ryan budgets as dovetailing with their state-level plans, which include shifting costs onto Medicaid enrollees through increased fees and reduced benefits. In the end, the state-level innovations most threatened by Romney and Ryan’s plans are the ones that don’t compute with conservatives’ pre-conceived policy preferences.