Q&A on Medicaid
On July 5, The New York Times podcast The Daily had a question-and-answer conversation between daily host Michael Barbaro and reporter Kate Zernike. We thought this conversation might be informative to our readers on the history and evolution of Medicaid, which today is part of the debate on health care legislation.
EDITOR’S NOTE:
QI have a very simple but what I fear may be a complicated question for you. What is Medicaid?
A: That is a complex question, isn’t it? So Medicaid is the federal government’s and states’ program to offer health insurance or help pay the medical bills of the poor. It now covers about 1 in 5 Americans, or about 78 million people. So that’s a lot of people. It covers half of the births in this country. It covers 2/3 of nursing home residents who are on Medicaid. It’s not just the poor anymore. It’s the disabled; it’s elderly people in nursing homes who have exhausted their savings. So the Medicaid population now is really quite broad.
QSo let’s back up a little bit. Where did Medicaid come from originally? What is its history?
A: So starting in the 1940s in this country, employers started to offer people health insurance. But then the question became, What are we going to do about people who can’t work — the elderly and the poor?
It’s interesting, when you look at stories about Lyndon Johnson signing this bill that created Medicare and Medicaid in 1965, the stories barely mention Medicaid. The elderly was the biggest question and that was the biggest fight and after the fight was over the bill became Medicare, which is, of course, the government health care program for elderly people.
Medicaid oddly enough was almost an afterthought, thrown in and nobody envisioned that it would become this huge program. Concerning the public debate about it now, you never would have guessed that in 1965.
QSo, in 1965, at its birth, exactly who did Medicaid cover? A: It really was just the poor.
QHow did Medicaid go from being this footnote, kind of a barely mentioned thing in 1965, as you just described it, to being something that so many millions of Americans now rely on for health care?
A: 78 million Americans. So first it was initially expanded under President Lyndon Johnson, a Democrat. In the ’70s, the American Medical Association was very against the expansion of Medicare; they called it socialized medicine. One of the biggest advocates for their position was Ronald Reagan, who of course was an actor at the time, and Ronald Reagan recorded this record calling Medicare socialized medicine.
Low and behold years later, some of the biggest expansions of Medicaid began in the Reagan years as a result of compromises worked out between Republicans and Democrats, but one of the compromises was with Henry Hyde. Henry Hyde is most known for the Hyde Amendment, which prevents federal funds from being spent on abortion. So Henry Hyde doesn’t want to cover abortions with federal money, so the Democrats say to him if we are not going to cover abortions with this money, we need to take care of pregnant women and their children. So that’s one big expansion.
Under Clinton, after the failure of Bill Clinton’s health care plan, which is sometimes called Hillary Care, there was an agreement between Democrats and Republicans that they didn’t want to pass this enormous — what Republicans called socialized medicine/Hillary Care/Clinton Care — but there was an agreement that we wanted to insure children, so Clinton had the children’s health insurance program (CHIP), which has now become hugely popular, so that’s another big expansion. That was a Bill Clinton initiative.
QAnd another big expansion.
A: Yes, another big expansion. And of course the CHIP program paves the way for the largest Medicaid expansion of all, which is of course Obamacare, or the Affordable Healthcare Act, which was passed in 2010.
QSo exactly how does the Affordable Care Act expand or change Medicaid?
A: Well, originally Medicaid was envisioned as a welfare program, and Democrats for years have been trying to separate it from welfare, and Democrats would say, “Hey, let’s make this our way to provide universal health insurance, right?” So that’s kind of what Obamacare did — was de-couple Medicaid from welfare. Because it was saying to people who weren’t maybe welfare-level poor but still pretty poor, “We are going to help you get health insurance.”
Now, with Obamacare, we have to be careful about one thing, which is there is the expansion of Medicaid under Obamacare but there is also the health insurance exchanges, right? That was not a Medicaid expansion. So Obamacare does two things in terms of expanding health insurance. It expands Medicaid to help people who are slightly above poverty level, but it also creates exchanges where people who are not at poverty level, and in fact are well above it, can also go and buy health insurance.
QWhat was the opposition to the Affordable Care Act’s expansion of Medicaid? Because as I recall there was a lot of opposition to it.
A: Absolutely. If you think about it, that was the genesis of the tea party movement in the summer of 2009. But the opposition was what Republican opposition has been all along, which is, these are handouts, these people are able-bodied. They can go out and get a job if they really needed health insurance. Why are we subsidizing these people?
That opposition, in as much as it fueled the tea party, and as much as it sort of stoked populism in this country. And populism in this country has always been feeling like someone above you is getting something that you can’t have and someone below you is getting something that they don’t deserve. So, maybe a lot of middle class or working people look at the Medicaid expansion and think, “Wait a minute, I had to earn this,” or “My mother, who paid down her little bitty savings to get into that nursing home on Medicaid, she had to pay down her savings. Why is that person just walking in?” If you listen to people, there is a lot of those people. And they have come and gotten Medicaid.
QAnd how many people have started to receive their health care through Medicaid since Affordable Care Act?
A: 11 million.
QThat’s a pretty big number. Just since 2010?
A: Yes. I think it is always easier to say no to something. The Tea Party was saying no — don’t do this. Now that it is in place, Medicaid has actually become kind of popular. Opposers will tell you that it’s always been popular, but I think the Medicaid expansion has made it even more popular.
QSo what would the GOP bill that started in the House that passed it and now is complicatedly making its way through the Senate, what would that do to the Medicaid expansion under the Affordable Care Act that has brought insurance to 11 million people?
A: In general, the bills would shrink the amount of money that the federal government is giving to the states to pay for Medicaid. So with the Affordable Care Act, the federal government started paying 100 percent of those costs, then it went down to 95 percent, now it’s at 90 percent, and I think it is supposed to go down to 85 percent or 80 percent. But instead of having those percentages and saying to states, “However many people come in and sign up for Medicaid, we are always going to pay this share of your costs,” it’s saying, “we are going to put a per capita cap on this Medicaid funding.”
QSo just to be clear, under the current Affordable Care Act expansion, it sounds like the federal government is on the hook for potentially huge amounts of money to pay the states to make sure that their Medicaid population is cared for.
A: Yes.
QUnder the Republican Senate plan, there will be some form of cap. It will say, “That’s it.”
A: Yes. There is no question that this is a huge outlay of federal money, right? Medicare was at $581 billion; Medicaid was at $553 billion, and of that the federal government is paying about $350 billion. Just an enormous amount of money. So there is no question — every time people have talked about deficit reduction, which has been talked about for decades — we are going to cut rates, or we are going to cut bureaucracy, or we are going to cut this. Really, unless you cut entitlements, you are not going to cut the federal deficit.
QSo why is this such a partisan issue if everyone agrees that Medicaid is really expensive and maybe too expensive?
A: It’s interesting. In some ways I think it has become less of a partisan issue. It has become more of a polarized issue like everything else in this country over the last 10 years, but I think what you are seeing now is a bunch of Republican governors standing up and saying, “Don’t cut my Medicaid expansion.” You are seeing Rob Portman and Shelley Cappello saying, “Don’t cut my Medicaid expansion; it’s paying for opioid treatment in my state which has a huge addiction.
So I think it is enjoying more bipartisan support, it’s just a little more difficult for Republicans to justify because they are the party of small government. They don’t like to think that this is the way that we provide health care. They are concerned about the Medicaid portion and what it would do to a state like mine; we have the largest per capita population that’s in the Medicaid program; it is a wonderful safety net for so many West Virginians. The bill is not that popular among West Virginians, and I think a lot of that is because of the Medicaid expansion and people have gotten so used to Medicaid. It is so hard to take an entitlement away.
QHow do we explain a state like Kentucky, where a very large expansion of Medicaid occurred and since the Affordable Care Act was passed, there is a large percent of poverty and there is a massive problem with opioids, and the man who created this Senate health care bill that would roll back the expansion of Medicaid under the Affordable Care Act is Sen. Mitch McConnell, who represents Kentucky.
A: And I would actually argue that Sen. Rand Paul, another Kentucky senator who is a Republican or libertarian, is possibly the biggest supporter of the tea party way. Rand Paul is from a libertarian strain, Rand Paul does not believe we should be giving thoese government handouts to people.
So, in some ways, that part of the Republican party allowed McConnell’s rise, and McConnell knows he is beholden to that point of view. McConnell is also a deal maker, right? And he is someone who moves legislation through, and he has been saying for seven or eight years we are going to take this away, we will rip this root and branch, so now he has got to do that. The New York Times