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  • Budget 2011: Another Taxpayer-Funded Medicaid Bailout

    Individual mandates cause headaches.

    As President Obama’s recently-released budget for 2011 reveals, with or without a health care reform bill, Medicaid stands to receive a big, taxpayer-funded bailout.  Again.  The 2011 Budget includes $25 billion in additional funding for state Medicaid programs as an extension of the bailout that was included in the 2009 economic stimulus bill.

    As Heritage analysts Dennis Smith and Nina Owcharenko argued then, depending on federal bailouts to carry Medicaid through economic hardships is bad policy.

    The stimulus bill provided increased federal matching rates for Medicaid programs in all fifty states.  This splurge in spending was accompanied by no caveats or strings attached to require true Medicaid reform, which is sorely needed.  Instead, the federal government succeeded only in propping up the failed policies behind the broken government program, encouraging continued sluggishness in actual improvements to the system.

    What is more, federal bailouts of state Medicaid programs set states up for short-term dependency on federal dollars which will lead to long-term budgetary problems when these funds expire.  Nothing could make this clearer than the Medicaid bailout extension included in President Obama’s 2011 budget.

    In a recent article in the Wall Street Journal, Janet Adamy explains that additional Medicaid funding was included to respond to Congress’ stalled efforts to achieve comprehensive health care reform.  Both of the health care bills would have expanded Medicaid and increased federal matching rates.  According to Adamy, “Some states were so confident Congress would pass a health bill that they included the extra Medicaid funds in their state budgets.”  Thus the need for additional bailout money: state fiscal irresponsibility, encouraged by Washington.

    If Congress had structured the previous bailouts correctly in the first place, this additional bailout may not have been necessary.  Smith and Owcharenko outline how this should have been done.  Of course, the economic stimulus should not have included increased government spending in the first place.  Rather, tax cuts should have been used to invigorate the economy.

    That aside, a Medicaid bailout should have established criteria to ensure that states accepting more funding took the necessary steps to improve their programs.  States should have also been required to submit plans for long-term reform.  Medicaid beneficiaries currently suffer from lack of access to care due to outdated reimbursement systems.  Addressing this would improve the quality of care for enrollees.  Lastly, both state and federal governments should have made a commitment to achieving serious entitlement reform as a part of the bailouts, assuring they would not be needed in the future.

    But none of this happened.  Instead, once the extra federal funding expires, states will be left to deal with balancing their budgets and footing the bill for the same low-performing Medicaid programs.

    Posted in Obamacare [slideshow_deploy]

    5 Responses to Budget 2011: Another Taxpayer-Funded Medicaid Bailout

    1. John B. San Diego says:

      Entitlement programs blowing up in the face of the federal government and state governments should be a sign that the federal government does not belong in the entitlement business. On the subject of business, elected officials and bureaucrats speak of Revenues, GDP and Deficits and Trade Balances as if they are owned by the federal government; this is not how those numbers should be thrown around. American People own all the money and all items I listed above, we should think of this on a grand scale.

      We Americans have hired money managers. Are you as an individual account holder satisfied with your account balance, of the performance of your agent keeping you informed individually on the way your money has been invested and the amount of return you have received. I'd guess the answer to be NO!

      The time has come to reckon with these huge government entitlements and think of some innovative charity and volunteer types of replacements that involve everyone except the federal government. The federal government owns nothing and the federal government generates no income, they are spenders of our wealth and wasters of our gathered fortunes.

      Washington D.C. wants BIG ENTILEMENTS!

      I Ask; are you ready for your real dollars to be returned at higher cost?

      The Defense of this country is the only business Uncle Sam should be in!

      The rest is just "Politicians posing Gift Givers Re-gifting Your Money”, rightfully back to you. Has anyone any idea how much money is lost to get re-gifted $$$?

    2. J.C. Hughes, Texas says:

      There are simple minded Americans who don't care about the bottom line or who's ultimately footing the bill. All they care about is being able to walk into a doctor's office at will and receive treatment. After all, everyone should be entitled to their perceived public service. These same individuals are now walking the halls of congress and the White House. Never before have I been aboard a vessel with such incompetence at the controls.

    3. John B. San Diego says:

      Moody's credit rating agency has issued a warning to the United States of America, that warning says our "AAA RATING" is in jeopardy.

      Many lenders foriegn and domestic are beginning to question Uncle Sam's ability to pay back the money we have borrowed.

      Take a hard look at the President's Agenda as a whole and his proposed 2011 budget specifically.Our interest alone is unsustaiable?

      God Bless America

    4. Jason Morman Canon C says:

      To give Medicaid to illegal aliens or anyone who does not qualify for it as medically necessary and apply for it just as I had to is unfair and an abusing the purpose of medicaid. I had to wait for two painful years to get my SSI. I had two spinal surgeries with no money to pay for the medicines. The pain was unbelievable with open neck and back surgeries and a failed back surgery. Now they are going to give it to anyone even if there is nothing wrong with them! I am already seeing the back lash from this BILL doctor are not taking medicaid even when they did before this bill passed. It is not fair to the disabled people! I have already lost my family doctor and I have been trying to find a new one. But I live in a small town of about 35,000 and with just my family doctor who let 3500 clients go I can't find another one I have even been trying Pueblo, Co.and most of them won't take medicaid or are full. So obama what can I do now? Take your suicide pill? And I have thought of doing it.medicaid wasn't meant to be a welfare program it was for the seriously injured people not some one who is not even a citizen! Thanks a bunch Mr. lets fix it obama you really fixed it now no one will take people on medicaid!

    5. African American wom says:

      I must say that I am not surprised by the reactions of people when speaking about any policy that is under President Obama. It doesn't matter if we are talking about Health Care Reform, Tea Party debate, Immigration, Budgets, Taxes, whatever. Americans seem to have a bigger issue with Obama.

      America was not and still not ready for a BLACK man to be in control, period. The backlash, images, jokes, comments, and out bursts speak for them self. Of course he knew what he inherited when he ran for office, but I don't think him or his family "signed up" for all of the negativity and finger pointing. I do not agree with a lot of things that President Obama is doing, but there is a different way to go about expressing it.

      I have seen displays of him dressed like a terriorist, his wife compared to a monkey, his family dressed in African attire, Obama face painted as the Joker from Batman … the attacks are pretty brutal. It's so hard to stay on topic and discuss the subject that is at hand when all African Americans can see if pure discrimination. I never felt apart of this country until Obama got voted into office. I feel so distanced now more than ever. America … you can have it back.

      Thanks for being the land of the FREE and the home of the BRAVE. We started African Americans as SLAVES so thanks for being so free and there is nothing brave about attacking a person that is trying to help.

      Love, Peace, & Happiness!

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