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Because individuals choosing to buy coverage is quite different than the state covering people, at virtually 0 cost (to the individual).
I'm disputing that the long term effects of medicaid expansion will provide a net benefit.
Rather than leave the program to focus on those who need it most, we're going to dilute it for everyone under X income.
Some states don't cover those who need it the most. In Texas, if you're a single person earning $3,000 per year, you are too wealthy to qualify for Medicaid. PPACA expands Medicaid to those earning less than 133% of the poverty line. That's $14,856 for a single person, or $30,656 for a family of four. Not exactly people rolling in cash, and not exactly what I would call "diluting it."
As it is, Medicaid pays less than 60%, of what private insures pay, adding more people (most of which are not in dire need) will not better things.
See above re: "dire need."
And comparing Medicaid to private insurance companies is a flawed comparison, because that isn't the choice that most Medicaid recipients face. Medicaid's 60% rate is considerably higher than the approximately 0% rate of what the uninsured poor pay.
Not only this, but it adds an unintended side effect.
When recessions hit, more people will qualify for the program and at the same time, states will have lower taxes to fund said program.
That would require the program to cut services to a greater degree, which hurts those who need it most, worse.
States will have a higher tax base in the first place, due to a healthier population that misses fewer days of work/school, and due to higher salaries resulting from fewer employers providing health benefits. Furthermore, the federal government is picking up 90% of the cost of the expansion, meaning that state Medicaid budgets will be mostly insulated from the effects of recession since the federal government is not constrained by budgets in the same ways that states are.
Something you missed, is that Medicaid already comes with federal subsidization, from 50% to up to 85%.
States are still cutting these services, regardless of current federal subsidy.
There is a huge difference between cutting Medicaid when you're getting a 50% subsidy versus when you're getting a 90% subsidy. In the latter case, states are getting NINE TIMES more federal assistance for every dollar they contribute.
Medicaid represents the 2nd largest budget item in most/all states, behind education spending, that's with federal subsidy.
States are already paying the health care costs of their uninsured residents, the costs are just more hidden and usually don't appear on any government balance sheet. The economic costs include hospitals or state governments directly picking up the tab for treating the uninsured, a lower tax base and less educated population due to absenteeism, increased risk aversion which discourages entrepreneurship and higher education, reduced job mobility which promotes economic stasis, etc.
Putting these residents on Medicaid doesn't create a new cost to the states...it just makes it clearer what the state was ALREADY paying and allows them to shift 90% of the cost to the federal government.
And if in the aggregate, most people use it irresponsibly, then it may not work out well.
Why would Medicaid recipients be more likely to use health care irresponsibly than anyone else who has health insurance? I think there are some rather nasty moral assumptions about people in poverty here.
I already know all this.
Describing "red states" as stingy, needs some backing.
Eligibility requirements are generally much stricter in conservative states. These states therefore will have the most federal subsidies coming their way starting in 2014, should they choose to participate.
http://www.kff.org/medicaid/upload/7993-02.pdf
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