The Alan Katz Health Care Reform Blog

Health Care Reform From One Person's Perspective

Upcoming Medicaid Cuts: A Single Payer Warning

Posted by Alan on November 26, 2007

If the debacle over funding for the State Children’s Health Insurance Plan (SCHIP) wasn’t enough, here’s another reminder why ceding control of health care decisions to the government can be hazardous to your health — especially if you’re not powerful or well connected. Washington is cutting yet more Medicaid funding and, as a result, services to California’s most vulnerable residents are at risk.

The Sacramento Bee reports at least $15 billion in Medicaid funding is being cut by the feds, $4 billion of that from Targeted Case Management programs. According to the article, written by Aurelio Rojas, Targeted Case Management programs are used by counties to serve “pregnant women and infants, the elderly who cannot care for themselves, the mentally disabled, foster children and adult probationers who receive substance abuse treatment.”

The federal dollars are used to match expenditures by state and county governments. Because of the nature of the programs, it’s not yet possible to project the impact on California’s Medi-Cal program (Medi-Cal is the state’s version of Medicaid). However, the Bee reports state officials as predicting it will be a “substantial amount.”

The cut to Target Case Management programs has been delayed by the current Congress, but that repreive is scheduled to end next year.  Governor Arnold Schwarzenegger has written California’s congressional delegation asking them to help extend the maratorium and to try to reverse the cuts. Whether that will happen is unknown, but there’s certainly no guarantee.

There are no market forces at play here, just the politics of the federal budget. There’s no doubt far more than $15 billion in pork, waste and funding for out-dated programs in that budget, but it’s pregnant women, infants, and the elderly who cannot care for themselves who are taking the hit. Yet single payer advocates want to turn our health care system over to the this government — or its state counterparts. Do they think that every president from now on will be liberal? That Democrats will hold a majority of Congressional seats forever? Or do they labor under the misconception that governments: 1) always do the right things; or 2) at least do fewer wrong things than private (especially for-profit) entities. If so, there’s little evidence this is the case.

Instead here’s yet another example of a government program facing mounting  financial problems that attempts to address the problem by whacking away resources from those who need it most. I doubt advocates of a single payer system would say this is the “right” thing. At least private insurance companies are subject to regulation by state agencies. Bad things happen, but they get addressed. Between market forces and government oversight the system tends to right itself. But when it’s the government itself doing something like what’s happening with Medicaid, it’s just business as usual.

Everyone knows that government programs tend to spiral away from their original purpose toward a state of non-reality enabled by a host of barnacle-like interests. It’s Political Science 101 — just look at the Farm Subsidy program. Does anyone think a government-run health care program will be any different? Would voters hold incumbents accountable at the ballot box? Not likely.

Supporters of the effort to pass Senate Bill 840 (Keuhl), which would eliminate private health insurance companies and put virtually all health care for nearly all residents of the state in the hands of government bureaucrats, often describe their proposal as offering “Medicare for everyone.” Whether that’s a good model or not is for a later post, but what amazes me is that they never seem to consider even the possibility that they’ll be delivering what’s happening to Medicaid today, instead.


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