What You Need to Know about Medicaid Reform
A PDF of this document is available here…
The Reconciliation Law Does NOT “Cut” Medicaid
- CBO estimates that Medicaid spending will grow by $2,019,000,000,000 over the next ten years
- Even after the $894.3 billion to $989.7 billion in savings from Medicaid, the program will still grow by over $1 trillion in the coming decade
- Using the “cut” phrasing implies government has a right to grow in perpetuity
Medicaid Spending Estimates Have Exploded
- $817 billion increase in ten-year CBO baseline from June 2024 to January 2025—12 percent increase in projected spending in only six months
- In May 2019, CBO projected 2025 enrollment at 77 million—now estimated at 84 million this year (roughly 10% higher than pre-COVID estimates)
- Biden Administration regulations at center of most of the $817 billion increase—repealing those actions a significant source of savings in the law
Federal Matching Funds Create Distorted Incentives
- States receive a much higher federal match to cover able-bodied adults (90%) than individuals with disabilities (50-77%)
- Over 700,000 vulnerable patients on waiting lists for care
- Provider tax “scam” and other funding gimmicks are designed solely to bilk Washington out of additional money
- Some states do not pay a single dollar in general fund revenue to finance their Medicaid expansion—no incentive to limit enrollment, or to fight fraud
Serious Problems with Eligibility Determinations
- Expansion exacerbated problem of crowd out—individuals dropping private coverage to go on the government rolls
- CMS analysis revealed 2.8 million individuals enrolled in multiple forms of coverage in 2024 (1.2 million in Medicaid in multiple states, 1.6 million in Medicaid and Exchange coverage), because neither states nor the Biden Administration took program integrity seriously
- High improper payment rate estimates due to eligibility errors
- Most people deemed “presumptively eligible” aren’t eligible or never apply for coverage (or both)
- Immigration problems plague Medicaid—need for stricter verification standards, Hillary Clinton quote about welfare state proving a magnet for migrants