A recent post-election doomsday headline reads, “Trump’s White House return poised to tangle health care safety net.” The following are quotes from the litany of dire predictions that Trump will destroy the Medicaid safety net.
- “…increase uninsured rate”;
- “…create new barriers to abortion”;
- “…erode…[ACA]…consumer protections”;
- “…insert work requirements into Medicaid”;
- “…impose funding cuts to the safety net insurance”;
- “…challenge federal agencies that safeguard public health.”
The last is particularly egregious after the immense medical, financial, and societal harm done to the American people during the COVID scam by the FDA, CDC and NIH, the very agencies tasked with “safeguard[ing] public health.” Challenge is the least that should be done to them.
Rather than disprove the above accusations in detail, consider why and how the U.S. medical safety net is indeed a tangled, complex, inefficient structure that spends too much and doesn’t provide adequate medical care. Answer: Washington. The federal government is constantly over-regulating Medicaid and Medicare so that medical care becomes increasingly less accessible while spending insane amounts of taxpayer dollars doing it.
The original 1965 Medicaid medical safety net was intended “to increase benefits [for a small number of Americans] under the Old-age, Survivors, and Disability Insurance System.” In 1966, four million Americans were enrolled in Medicaid. With repeated federal expansion of eligibility rules over 57 years, the Medicaid safety net covered 92.3 million Americans — 27.6 percent of the entire population — by December 2022.
Not only did CMS (Centers for Medicare and Medicaid) greatly expand eligibility over the years, it also increased benefits. The resulting medical costs of the program skyrocketed to consume 10 percent of the entire U.S. budget in 2023.
Washington’s joint state-federal matching funding mechanism, FMAP (Federal Medical Assistance Percentage), encourages spending, not saving. The federal government applies a multiplication factor to what a state budgets for its Medicaid program budget and gives that amount each year to the state. The poorest states, i.e., with the lowest per capita incomes, have the highest multiplication factors.
Note that the more one state budgets for its Medicaid program, the more taxpayer dollars are distributed by the federal government to that state.
In addition to constant expansion of medical costs and the drive for states to spend more (to get more), there is the ever-increasing cost of federal complexity called BARRCOME — bureaucracy, administration, rules, regulations, compliance, oversight, mandates, and enforcement. This expense is estimated at 31 percent to more than 50 percent of all U.S. healthcare spending. In 2023, that was $1.5 trillion to $2.4 trillion Washington took from care for Americans and paid to … itself.
At present, the U.S. has an unnecessarily complex, ever-changing, user-unfriendly, and massively expensive medical safety net. The word tangled is too mild a descriptor.
The way to fix our medical safety net is simple: follow the law. Below is Section 1801 of the original 1965 Medicaid law.
SEC. 1801. Nothing in this title [the law] shall be construed to authorize any Federal officer or employee to exercise any supervision or control over the practice of medicine or the manner in which medical services are provided, or over the selection, tenure, or compensation of any officer or employee of any institution, agency, or person providing health services; or to exercise any supervision or control over the administration or operation of any such institution, agency, or person.
Untangle Medicaid using Section 1801. Other than funding, Washington should have no involvement in state Medicaid programs. No federal BARRCOME, none.
If California wants to make illegal residents eligible for its safety net and Texas does not, that is proper and legal.
If Oklahoma wants work requirements for able-bodied enrollees and Illinois does not, no problem.
The Supreme Court returned abortion decision-making to the states when it overturned Roe v. Wade. The federal government should have no say, and Trump has said he will follow the Supreme Court decision. If Alabama prohibits abortion and New York allows it, both are following the rule of law.
If Texas, like most of the nation, no longer trusts the FDA, and wants to start its own TDA (Texas Drug Agency) within existing resources as part of its safety net, that should be a Texas prerogative.
Funding of state Medicaid programs should be a block grant. California provides a good demonstration of why funding should be a fixed sum from Washington, not an amount that varies with state budgeting. If Governor Newsom wants to provide medical care for illegals, or if he believes housing and food are medical benefits of a safety net, that is his decision. But he should pay for it out of the fixed sum allocated to the Golden State and not demand taxpayer dollars from other states to fund his ideas.
Untangling Medicaid can be simple: follow the law. As a side benefit, taxpayers could save trillions of dollars. (We hope RFK, Jr. and/or Elon Musk and Vivek Ramaswamy are reading this!)
Deane Waldman, M.D., MBA is Professor Emeritus of Pediatrics, Pathology, and Decision Science; former Director of Center for Healthcare Policy at Texas Public Policy Foundation; former Director of New Mexico Health Insurance Exchange; and author of 12 books, including multi-award winning, Curing the Cancer in U.S. Healthcare: StatesCare and Market-Based Medicine. Follow him on X.com a @DrDeaneW or contact via www.deanewaldman.com.
Vance Ginn, Ph.D., is president of Ginn Economic Consulting, host of the Let People Prosper Show, and previously chief economist of the Trump White House’s Office of Management and Budget. Follow him on X.com at @VanceGinn.
image, Pixabay license.
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