Replacing Medicaid With Obamacare

Feb 15 2013 @ 5:43pm

Wisconsin’s Scott Walker recently became the 13th governor to turn down federal money to expand Medicaid, opting instead to move Wisconsinites between 100% and 200% of the poverty line into the ACA health care marketplaces. Sarah Kliff thinks Walker’s idea “might have legs”:

Walker’s office estimates that, under this approach, the state will extend health insurance coverage to just over 224,000 Wisconsinites. That’s not quite as many as would gain coverage under the Medicaid expansion, although it’s relatively close: 224,580 instead of 252,678. The premiums for those who ended up purchasing coverage on the exchange, instead of receiving it through Medicaid, are relatively low for those right at the poverty level. They would increase as income went up.

With this approach, Wisconsin will miss out on one of the most appealing features of the Affordable Care Act: the federal government footing the entire bill for Medicaid enrollees newly eligible under the health reform law. … Walker expects that enticing [funding] will ultimately get cut back and that could leave Wisconsin on the hook for a bigger chunk of the Medicaid bill than it ever expected.

Avik Roy cheers Walker on:

Obamacare’s exchanges, while seriously flawed, are reformable in a way that Medicaid is not. Indeed, the exchanges could someday be expanded to provide coverage for people who are today on Medicare and Medicaid, resulting in true, long-term entitlement reform. Scott Walker’s plan is a small but important step toward that goal.

Geoffrey Cowley pushes back, writing that “the new state insurance exchanges are designed for employers and middle-class consumers, not for the poor” and that “many people who can’t afford the premiums won’t qualify for assistance”:

Walker’s plan does open the state’s Medicaid program to thousands of childless adults who have languished for years on waiting lists. But to open those slots, it will force thousands of current Medicaid patients—most of them people with children in their care—into the private insurance market. … It’s worth noting that the exchange at the center of Walker’s initiative is the same one he has refused to build in partnership with the federal government. To avoid expanding Medicaid, he is handing off Medicaid patients to another federal program. His tagline for the initiative: “From Dependence to Independence.”