All the buzz in Washington, DC is the threat of a federal government shutdown over the current year’s budget–and of Rep. Paul Ryan’s budget plan for the next federal year and beyond.
The major savings of Ryan’s budget plan come from Medicare and Medicaid. And it’s true that any serious attempt at deficit reduction has to be–more than all these cuts in discretionary programs that have been fought about in the current-year budget–about health care, and reducing the overall cost of care. But the problem isn’t a Medicaid or Medicare issue–it’s a health care issue, since its costs are rising overall, and in fact Medicaid and Medicare do a comparatively better job holding down costs than the private market outside.
The Affordable Care Act started down this approach with specific reforms to help control those costs–from prevention to electronic medical records, from experiments with paying providers differently, to other delivery system reforms, from trasparency in pricing to comparative effectiveness research, from bulk purchasing to public health interventions.
In stark contrast to the ACA (which would be repeal under this effort), the Paul Ryan proposal seeks not to control the cost of health care, but simply to shift those costs–onto us. The Medicaid block grant proposal, for example, does not seek to lower care, but simply shifts costs and risks onto states and low-income families. States would get a capped amount of money to run their Medicaid programs–even if in a recession enrollment grows as more people need the program. At exactly the economic times when states are experiencing less revenues, this policy would force states to make the tough decisions about limiting enrollment, reducing benefits, etc.
So there’s much more to say about how it fundamentally attacks low-income people and redistributes wealth upward; how it relies on wildly unrealistic economic assumptions; how it undermines Medicare; and how the proposal just gives up on helping families feel more economically secure.
But I want to highlight the objections of Governor Jerry Brown, who joined 16 other Governors in opposing a Medicaid “block grant” proposal. As the letter states:
“A Medicaid block grant imposed unilaterally by Congress on all states that would cap the federal government’s share of costs and provide fixed annual funding below the projected growth of program costs is simply unacceptable. The inadequacy of funding would grow over time and would be exacerbated by unanticipated increases in health care costs and enrollment. The costs of population increases, aging populations, economic downturns, natural disasters, new diseases or epidemics would all be shouldered by the states…”