The term “Medicaid” has been bounced around tirelessly over the past few months, as Republicans sought to viciously gut the program. But unfortunately, despite how often we hear the word, a lot of people don’t even really understand what Medicaid is or does. Beyond that, many Americans haven’t taken the time to grapple with what the implications were of its expansion via the Affordable Care Act, and its dramatic proposed scaling back via Paul Ryan’s repeal bill which was loudly defeated last Friday.
Medicaid has been around since the Social Security Act was amended in 1965. It essentially set up federal funding for states to provide healthcare to its poorest residents below a certain poverty level. States were not required to participate, but all have since 1982, and each sets its own parameters and qualifications, while being monitored by the Centers for Medicaid Services. Which is part of what makes it so confusing. You can qualify for Medicaid in one state, and not in another—with even more disparity after some states chose to expand Medicaid under the ACA, and others did not.
States that chose to expand were markedly democratic—like New York, Colorado and California. States that chose not to were more historically red, like Tennessee, Texas and Kansas. Essentially, states that chose not to expand were doing so exclusively to tow the party line. These states’ Governors explicitly chose to not accept millions in government funding for their citizens most in need to have the simple right to medical care.
Conservative rhetoric and propaganda has deeply infused a misperception of welfare, as government aid that is haphazardly handed out with little discernment between those in need and those who chose to exploit programs. But that is very much not the case for Medicaid. Without expanding it, state governments created situations in which those making less that 100% of the poverty line—roughly $12,000—didn’t qualify for both state paid for care, nor private plans available through the federal Marketplace (healthcare.gov). Thereby creating a situation in which the poorest, most in need people are left without any way to get medical care.
States that did chose to expand Medicaid positively benefited their states, and in a roundabout way the whole country. Not only did the expansion up the level of income residents could make and still qualify for Medicaid to 138% of the poverty line—roughly $16,000—it took pressure off of the federal Marketplace to absorb low income citizens. That is beneficial to the whole system for many reasons. Someone making very little money is likely to chose a plan on the federal Marketplace with a high deductible and maximum out of pocket to keep their premium down. If something were to happen to that enrollee in which they need to use that insurance, and they become responsible for meeting their deductible, they likely won’t be able to afford that, creating a situation where they either become a bigger burden on the government, or potentially lose even more financial stability to overcome the situation.
On top of that, the federal Marketplace gives out large subsidies to people making low incomes, especially if they are older. So its completely illogical for a state to turn down government funds that would insure low income citizens of that state on a pubic Medicaid program, and instead then ask the federal Marketplace to allocate funds to subsidizing the same citizen’s privatized plan. Every state that chose to not expand Medicaid made a bold, reckless move all to spite the Affordable Care Act hoping that by multiple states refusing to participate the ACA would fail.
Refusal to expand also created another costly side effect for citizens. By turning down extra Medicaid funds, and pushing more sick people into privatized plans, health insurance companies took on more claims losses. When insurance companies have high claims losses, they are approved by states for premium increases, which means everyone’s premium went up. And unfortunately the poor tend to have less favorable health. The New York Times reported last fall, “A substantial body of research has shown that lower-income Americans tend to have poorer health than those who earn more. (Cause and effect isn’t clear: People may be unable to earn a higher income because of health problems.)” I’d beg to argue that cause and effect is very clear—the poor have less access to fresh and healthy food, nutritional education, and more exposure to unhealthy lifestyle choices like drugs, smoking and alcohol. All of those things culminate in poor health. So states knowingly chose to force a markedly sick population onto the private system, knowing it would negatively impact their tax paying constituents.
Ultimately conservative lawmakers have succeeded. Their failure to concede for the greater good, and of some states to expand has put more stress on the privatized system, requiring insurance carriers to take on more sick risk, and the federal government and private citizens to pay for it. So when Republican lawmakers suggest that the ACA is solely to blame for its own shortcomings, they’re simply wrong, and/or lying. And the lies are only continuing as Republicans continue to talk about doing away with Medicaid, which the recent bill would have cut to the point of 24 million people losing coverage. So think twice next time you think that Medicaid doesn’t effect you, or its dissolution wouldn’t impact you. It already has.
Image: Images Money, CC-BY
Chloe Stillwell is a Nashville-based columnist focusing on politics, culture and feminism.