Why Refusing To Fund Medicaid Expansion Is A Huge Win For Taxpayers And The Needy

Why Refusing To Fund Medicaid Expansion Is A Huge Win For Taxpayers And The Needy

With the recent announcement that it will not fund partial Medicaid expansions under Obamacare, the Trump administration delivered a big win for the truly needy, able-bodied adults, and taxpayers alike.

Predictably, some Democrats are attacking the move, saying it will destroy lives and the economy. But these are the same lies Democrats have voiced for years every time a lawmaker proposes a reform that will deliver the change the Medicaid program desperately needs. These lies aren’t just untrue — they ignore every piece of relevant research.

The reality is that Medicaid expansion, whether full or partial expansion, is a bad policy move. It threatens resources for the truly needy, pushes hundreds of thousands of able-bodied adults into welfare, and stretches state budgets to their breaking points.

States have consistently underestimated expansion costs and enrollment, enrolling more than twice as many able-bodied adults than predicted and costing taxpayers 76 percent more per enrollee than promised. Medicaid expansion siphons resources away from the people Medicaid was designed to serve — pregnant women, poor children, and those with disabilities, among others — and gives them to adults who are capable of working. It pushes people off private insurance and gives them taxpayer-funded government benefits instead.

And let’s be clear: Packaging it in a shiny new box and calling it “partial expansion” is nothing more than wishful thinking. Medicaid expansion in any form is a massive increase of the welfare state.

That’s why the Trump administration’s announcement that it will not offer Obamacare funding for partial expansions is so important. This will help deter states from wading into the waters of a bad policy that would have immediate negative effects.

States that have tried “creative” ways to expand Medicaid, including Arkansas, Iowa, and New Hampshire, have seen costs skyrocket. In many cases, these “private options” have resulted in cost overruns larger than traditional Medicaid expansion.

Nationally, Medicaid expansion has resulted in cost overruns of more than 157 percent. We’re not talking about a few extra hundred dollars. We’re talking about billions of dollars of debt that means less money for education, public safety, and roads.

Other states have wandered down the road of Medicaid expansion, expecting they could turn around at any moment, only to find out it’s a one-way street. With the real legal likelihood that reversing expansion isn’t possible, Medicaid expansion has become a real-life nightmare version of “Hotel California.”

Still, some continue to ignore these facts and advocate for expansion. Their claims that Medicaid expansion is necessary to help the truly needy couldn’t be a more blatant lie. Medicaid already covers the truly needy. In some states, Medicaid already covers some able-bodied adults, as well. But most able-bodied adults in Medicaid expansion do not work. To be clear, expanding Medicaid does not benefit the truly needy; it threatens the resources they depend on.

The Trump administration’s announcement is a clear signal to states that now is not the time to be expanding welfare. It follows the administration’s continued support for commonsense Medicaid work requirements, which would deliver positive change to the Medicaid program, and efforts to bolster the economy and lower the cost of health care.

Especially with record-low unemployment and the best economy in decades, it’s a good reminder that the best health care doesn’t come from Medicaid. It comes from a job.

The administration deserves praise from taxpayers on both sides of the aisle, who can breathe a sigh of relief that they’ll avoid the boondoggle that is Medicaid expansion. This is a big win for the truly needy, whom Democrats claim they want to help.

Kristina Rasmussen serves as the vice president of federal affairs at the Foundation for Government Accountability.
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