Medicaid Is the Future of American Health Insurance -- If It Can Survive the Next Two Weeks

Bill Clark/CQ Roll Call via AP Images

Participants hold signs during the Senate Democrats' rally against Medicaid cuts in front of the U.S. Capitol. 

While liberals often say that their ultimate goal in health care is "Medicare for all," the current debate over the Republican plan to repeal the Affordable Care Act should show us that if there's a path to a universal and secure health-care system, it may be more likely to come through Medicaid, which is now America's largest insurer. That is, if Medicaid can survive the next two weeks.

Republicans in the Senate are hoping to vote before the July 4 congressional recess on their health-care plan, which they will do without holding a single public hearing or committee markup (where amendments are voted on). In fact, their terror that the public might actually get a look at their bill is so complete that most of the Republican senators haven't even been told what's in it. But one thing we do know is that it represents an outright assault on Medicaid, despite the fact that supposedly moderate GOP senators were reluctant to eviscerate the program that has benefited so many of their constituents.

Apparently, those senators have gotten over their doubts. From various reports we've learned that the Senate plan would roll back the ACA's Medicaid expansion over seven years (as opposed to the three years in the House bill), but that's just the beginning. In order to pay for a massive tax cut for the wealthy, they're considering deep cuts to the program over and above what rescinding the expansion would entail. And they want to eliminate Medicaid's guarantee of coverage for poor Americans, turning it into a block grant and giving states "flexibility" to slash benefits and kick people off the program.

We don't know if they'll get away with it—if enough public pressure gets applied over the next two weeks over this plan to take health coverage away from millions of people, a few of those senators may back down. Meanwhile though, liberals are realizing that strengthening and expanding Medicaid is one of the simplest ways to move the country toward truly universal coverage.

In Nevada, Republican Governor Brian Sandoval vetoed a bill on Friday that some were calling "Medicaid for all," though it was essentially a public option—it would have established a government insurance plan within Medicaid that would have been sold on the state's insurance exchange, and which anyone could buy. By everyone's admission the details weren't fully worked out, but what's remarkable is that it passed both houses of the legislature in this swing state, and even Sandoval said some nice things about the basic idea.

If we put aside for a moment the way Washington Republicans are hell-bent on destroying Medicaid as we know it, there are multiple factors that make it a ripe target for expansion, should Democrats get the chance. Changing the eligibility requirements for Medicaid would be a legislative task much more than an administrative one, making it simpler than creating a new, national public option from whole cloth. And Medicaid is simpler than Medicare, which is divided into multiple parts (Part A for hospitalization, Part B for routine care, Part D for prescription drugs) and includes significant involvement by private insurers through Medicare Advantage.

Furthermore, while we think of Medicaid as being more politically vulnerable than Medicare—its poor beneficiaries are a far less potent constituency than Medicare's elderly ones, who are organized and vote religiously—that could actually make expanding the program easier. As the Prospect's Paul Starr notes in his proposal for a "Midlife Medicare" program that would open up Medicare to anyone over 50, "many seniors insist that Medicare is their program, and they fear—or can be made to fear—that extending the program to others will jeopardize their coverage." Whatever the political obstacles, we wouldn't have to fear a revolt from Medicaid recipients if it were expanded.

Let's imagine for a moment that the current Republican health-care effort fails. In attempting to undo the ACA, they managed something Democrats tried and failed to do for seven years: They made the law's benefits clear, and made Americans (justifiably) fear what would happen if those benefits were taken away. More than ever, there's a desire in the public for simple, secure, affordable health coverage.

Which is exactly what Medicaid can offer, if it is expanded beyond its current status as a program for the poor. In fact, it could be the gateway to something like the highly successful hybrid systems in place in countries like France, in which there's a government insurer that covers everyone's basic health-care needs, and then everyone is free to buy private supplemental insurance that offers more benefits. In theory anyway, that's a system that even conservatives could find at least somewhat appealing, since it allows rich people to have fancier coverage than the rest of us. Medicaid could be that basic program, or at least a backstop for anyone who doesn't get insurance through their employer, regardless of their income.

There are a lot of complications to the kind of transformation in Medicaid I'm suggesting here. The program is jointly administered by the federal government and the states; the latter set the eligibility levels, which means that in Republican-run states, particularly in the South, you have to be desperately poor to be eligible (one example: in Texas, if you're an adult in a family of four and you make $3,691 a year, you're too rich to qualify). The ACA tried to eliminate the state-to-state disparities with the Medicaid expansion, but the Supreme Court ruled that as long as it was jointly administered, states could refuse the free money the federal government was offering to insure more poor citizens, and that's just what 19 Republican states did.

So the best option might be to federalize the entire program, offering everyone the same benefits whatever state you're in. That, of course, would require an increase in federal taxes (though it would enable cuts in state taxes), which wouldn't be easy to pass.

There's no question that a dramatic expansion of Medicaid would be politically difficult. The reality is that any attempt to broaden Medicaid—making the benefits uniform, allowing people who aren't poor to buy it as an insurance option—would require not just a Democratic president and a Democratic Congress, but a president and Congress that were fiercely determined to make sweeping health-care reforms no matter the political obstacles.

Might we get it one day? It's certainly possible. The backlash from the shockingly cruel bill Republicans passed in the House has already been felt, though we'll have to see what happens in the Senate. It requires little imagination to envision Democrats taking the House in a 2018 sweep, then having an equally good 2020 election, in which a deeply unpopular Donald Trump is tossed from office and they win back the Senate as well. Should that occur, the voters who put them in office may demand that something ambitious be done on health care, and fast. A quick transition to a completely single-payer system may be a practical impossibility, even if support for (usually vaguely defined) single-payer is on its way to becoming a majority position within the Democratic Party. But an expansion of Medicaid could accomplish a lot of what Americans want out of their insurance. And it just might be possible—if Republicans don't drive a stake through its heart in the coming days.

You may also like