While plenty of attention has been drawn to Paul Ryan’s plan to convert Medicare into a private-public partnership along the lines of Medicare Advantage to cap government spending on elderly care, less attention has been shown to another of his proposals on Medicaid. In part, it’s because there seems to be less emotional opposition to the idea of converting the program that provides health care for the poor into block grants to states that will limit federal intervention and cap spending, at least on the federal level. Dan Mitchell of the Center for Freedom and Prosperity explains why this Medicaid reform will provide much-needed fiscal sanity and a good starting point for spending reductions in the future:
Will a block-grant Medicaid allow for state-level innovation? Of course — and that might be part of the problem. If states innovate in ways that allow people to slip through the cracks, even in very small numbers, advocates of the centralized approach will highlight the failures as a demand to apply equal standards across the country. We’ve seem some of the same pushback on welfare reform, which Barack Obama at least suggested he might undo during his presidential campaign, even though (as Mitchell notes) the reforms that Bill Clinton eventually backed out of political necessity have performed well in the years since.
Mitchell’s idea to use block grants to phase out Medicaid probably makes the most sense in terms of fiscal discipline; states should determine what works best and fund those purposes themselves. Ryan’s plan is more realistic in that a complete defunding is unlikely to succeed, and so he’s planned on cost control rather than elimination. As long as the program exists, though, it will provide a tempting target for funding increases and a reassertion of central control. At least Ryan wants to take a step in the right direction.
We’ll see if Democrats are willing to at least take that step, or whether they plan to demagogue in order to paint Republicans as heartless lackeys to rich fat cats out to steal health care from the poor. I know which way I’m betting.