Reforming Medicaid

Many health policy minds have tried to infuse a “What about Medicaid?” attitude into the intense discussion over reforming the nation’s health entitlement for seniors (Medicare). Yet, to much dismay, there is not a lot of public discourse over reforming the nation’s health program for the poor. Other than President Obama’s Medicaid expansion in the Affordable Care Act and Mitt Romney’s plan to block grant Medicaid and limit federal standards on the program, there are few other options about which people are talking.

Reading Alan Enthoven’s 1978 Consumer-Choice Health plan, which served as the basis for the managed competition theory in health insurance (and therefore a precursor to , , and the ), made me think about reforming Medicaid.

 

Here are some options (let us know what you think via comments):

• Block grants for Medicaid; allows for fixed funding from the federal government instead of open-ended payments to states (Republican plan)
• Managed competition (1); providing the Medicaid-eligible population a refundable tax credit in order to purchase private insurance (Heritage, 1989)
• Managed competition (2); providing a voucher to the poor to purchase health insurance the value of which slowly declines as income rises to maintain work incentives (Enthoven, 1978)
• Continue defined benefit plan; savings from pooled purchasing of drugs, preventing avoidable conditions (Democrat plan)

What would be your plan for reforming Medicaid?