Medicaid Is Not a Welfare Program

By Michael Anne Kyle

Medicaid is often thought of as a welfare program because of the essential role it plays in providing health insurance for low-income people. However, looks can be deceiving. In terms of scale and scope, Medicaid is rapidly becoming a powerhouse player in health care.

Medicaid enrollment is booming as a result of the Affordable Care Act (ACA): nearly 72 million people are enrolled in Medicaid and the Children’s Health Insurance Program (CHIP). To put this in perspective, about 55 million people are enrolled in Medicare and about 64 million in the UK’s NHS. Medicaid enrollment is likely to continue rising as more states contemplate expansion. As of this month, 30 states and the District of Columbia have expanded Medicaid under the ACA.

Size isn’t the only way Medicaid is changing. Unlike Medicare, Medicaid is a joint state and federal program, which means that states have a lot of latitude to innovate with both delivery and payment. The ACA has enhanced opportunity for reform through planned initiatives like the Center for Medicare and Medicaid Innovation (CMMI), and unexpected pathways, like negotiations around Medicaid expansion – these have yielded some of the most radical departures from the traditional public program paradigm, even in states that have not sought a “private option

Finally, it is critical to note that although we associate Medicare with the elderly, long-term care actually falls under Medicaid. In fact, with just over half of the market share, Medicaid is the largest insurer of long-term care, also known as Long-Term Services and Supports (LTSS). Medicaid coverage for the elderly and disabled comprises a greater percentage of overall spending than coverage for low-income adults and children.

So, what does this all mean? Compared to Medicare, which is a nationwide program with a powerful political constituency, Medicaid has been relatively ignored as a driver of health policy. In addition, Medicaid’s federated model has made it a challenging topic for research because data are fragmented and programs not always easy to compare across state lines. However, Medicaid is in the middle of the action when it comes to some of our most pressing health policy questions, whether it’s trying to figure out what to do about long-term care, or testing integrated delivery models. It’s time to stop thinking of Medicaid as a welfare program and start recognizing it as driving force in policy, financing, and service delivery in the United States.

One thought to “Medicaid Is Not a Welfare Program”

  1. Enrollment is booming because we have more and more people falling into poverty. The other trend is doctors refusing to take Medicaid patients since the reimbursement rate is less than cost. Neither is a trend worth celebrating and “powerhouse” is hardly an appropriate term.

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