Medicaid Plus: a simpler, cheaper alternative to Obamacare

A simpler and cheaper alternative to the Affordable Care Act is an expanded Medicaid program available to every American citizen who desires a basic level of health care. Such a program would allow access for current ACA enrollees and the still large number of uninsured (9 percent of the U.S. population) to the existing Medicaid health care delivery system, which includes private practice physicians, federally qualified health centers as well as the rapidly expanding managed care networks now operational in 44 states – including Florida.

Such an adjustment to the existing Medicaid program would not be cost prohibitive. In fact, with the addition of a small monthly premium based on income, it would be revenue-positive. The math works likes this. For incomes up to 100 percent of the federal poverty level, no monthly premium. Between 100 percent and 199 percent, $25 a month. Between 200-400 percent, $50 a month and $100a month for those at 400 percent or higher of the federal poverty level. Cost of the program for those migrating from ACA and also to cover the currently uninsured is $121.6 billion. This is based on the average annual cost of $3,247 for an adult and $2,463 for each child in the current Medicaid program. For purposes of this illustration, I am assuming that the Medicaid-eligible elderly and disabled are not significant numbers of the migrating population, since most of them are already in the Medicaid system.

Offsetting the expense of adding 40 million Americans to Medicaid Plus are premium payments of $22.6 billion and elimination of ACA expense, which amounted to $110 billion in fiscal year 2016. The net revenue gain from moving to expanded Medicaid is approximately $11 billion. Obvious advantages of this program are that many more people can overcome state Medicaid guidelines which curtail medical coverage, since the current restrictive coverage guidelines will be eliminated. By making coverage mandatory, the perverse and costly effect of “last-minute” enrollment peculiar to the ACA is eliminated. Tax returns will be simplified back to the “pre-ACA days, since the premium will be part of the annual income tax calculation. And lastly, but most importantly, no more $6,000 deductibles, which will open the American health care system to all citizens at an affordable cost.

This story was originally published April 28, 2017 at 11:17 AM with the headline "Medicaid Plus: a simpler, cheaper alternative to Obamacare."