Medicaid's Imperiled and Imperfect Present, and Ideal Future
HVDSA member Gen Paczewski has once again written a stunning article for our chapter, discussing in depth the necessity of Medicaid, and how important it is to our community that we protect and extend the program's ability to assist those who need it! Curious to know more? The full article is written below!
Medicaid's Imperiled and Imperfect Present, and Ideal Future
By Gen Paczewski
The Trump administration’s Big Beautiful Bill has passed, and it makes deep cuts to Medicaid. Medicaid is the single largest provider of healthcare in the U.S., insuring as many as 71 million Americans, and these deep cuts are nothing less than open class war against American workers. The cuts are all being made in service to giving large tax cuts to Americans in the highest income brackets. So, they’re taking your tax money, pulling it from us, and giving even more of it to people who already pay lower taxes than average Americans.
Before discussing exactly how the bill would harm Medicaid, it’s important to understand how Medicaid is funded and operated. Timothy Faust is a healthcare activist, and wrote the book Health Justice Now: Single Payer and What Comes Next. Faust explains that Medicaid, a program that offers health insurance to low-income people who are under 65, is funded by both the federal and state government. In richer states, the cost of Medicaid is split equally, but in poorer states the Federal government pays up to 75% of the Medicaid budget. Since Medicaid is administered by individual states, the quality and access varies by state. Some states have stricter (and crueler) requirements, and others more expansive limits. Faust points to Texas as a state with strict guidelines for Medicaid recipient eligibility- eligible Texans must be: Disabled, parents making less than $3,600 a year, single pregnant people making less than $24,000, or children living in a household with income less than twice the poverty level.
One of the primary methods states use to fund Medicaid is a tax on hospitals and other providers of healthcare, which varies by state. This provider tax, and special payment arrangements, will now be severely restricted, and will “...shift hundreds of billions in costs to state budgets,” reports Gov Facts in their article “How the One Big, Beautiful Bill Targets Medicare and Medicaid.” BBB also cuts the percentage of funds the federal government provides for Medicaid to states.
The most likely effect the bill will have on Medicaid is for states to impose work requirements on recipients, a thing some states have already tried to do. After the passage of the Affordable Care Act, states were offered monetary benefits if they chose to expand Medicaid eligibility requirements, and although some refused, many did expand. The National Center for Health Statistics reports 31.6 million were uninsured in 2020, but after the ACA’s encouragement of Medicaid expansion, that number dropped to 27.2 million by 2024. Work requirements will kick many recipients off Medicaid, especially many who got coverage under expanded programs. Faust explains why work requirements for Medicaid are a problem: People on Medicaid are usually already working, and if they’re not, they’re genuinely unable to. 92% of adults on Medicaid are already working, and those who aren’t are either in school, or are too ill to work or are working as full-time caregivers for a friend or family member, reports the Center for American Progress in their article “House Republicans’ Big, ‘Beautiful’ Bill Would Make Health Care More Expensive for Americans With Medicare and Other Insurance.”
Work requirements result in Medicaid recipients having to “...endure long waits or use websites that don’t work (plus, many Medicaid recipients don’t have reliable access to the internet) to log their hours with a severely understaffed benefits office,” Faust says. “...when Arkansas tried a similar rule, thousands of people lost coverage due to paperwork problems and reporting errors—not because they stopped working,” Gov Facts reports. When the reporting method is unreliable or difficult to access, and recipients are unable to report work hours, they lose their healthcare,and then are often unable to pay the high cost of ACA marketplace health plans, and become uninsured again. With state budgets already going to suffer under the BBB, there likely won’t be money available to staff and maintain an expanded reporting apparatus that will have to handle a surge in the amount of paperwork they’ll need to process.
Any reporting apparatus will be further strained by the BBB requiring states to check adults for eligibility every 6 months, as well as eliminating a provisional eligibility, which allowed recipients to get care while their paperwork was being reviewed and will leave people without health care for weeks or months.
The people who lose coverage will still need care, but now they’ll get it only after something more serious (and more expensive) happens, and will lead to the cost of insurance going up even for people who manage to hold onto their Medicaid or even private insurance, because hospitals factor in unpaid but life-saving care they administer to uninsured patients into their costs, and raise prices accordingly.
Expanded Medicaid has improved health outcomes for many people, but Faust points to the uneven quality of Medicaid and patchwork funding methods of our current system as reasons to imagine what Medicaid can be. He argues for a federal universal single-payer system that covers all care for all people. Specifically, Faust says Medicaid is currently subsidizing a variety of insurance companies and providers who want to pay for as little care as possible, and thus try hard to bar the poorest people (who are generally the most ill, since poverty negatively impacts health outcomes), as well as who drive up care costs by setting as high a price as they can get away with. He points out that America spends the most on healthcare of any other country, but we consistently have worse results due to the profit-driven nature of our care, which prioritizes paying for as little care as possible and charging as much as possible for that care. We already spend a lot of money on healthcare, and moving to single payer would actually cut costs because if there was only one insurer- the federal government- they have the leverage to set price limits. Care costs continuously rise every year due the ability of insurance and hospitals and medical equipment companies raising prices constantly. Single payer would stabilize our care costs, guarantee everyone can access healthcare, and break the grip profit-focused capitalists have on our health. We’re already spending this money, single payer would just make sure we’re spending it in a way that gets everyone better care. Faust points out that instituting single payer would also create jobs, as many people would be needed to adjudicate the records, enrollment, carrying out of such a massive program, as well as hopefully hiring more social workers and advocates who could offer support to people struggling.
There are some local ways to build toward Medicaid for All in Michigan. Faust encourages people to talk to their own community members about their healthcare, and gather people and their stories together and bring them directly to your local and state politicians. Simply repeatedly showing up in person and pressuring representatives with the reality of American healthcare has resulted in some states either voting to expand their medicaid enrollment, and has stopped politicians from going through with cuts to medicaid as well. This ground-level building would enable us to put pressure on, and keep it up, when Medicaid is threatened by legislation and budget cuts.
There are also a few Michigan programs available to help those unable to afford care. Dollar For is a non-profit group that helps people understand and navigate hospital billing, and provides help bargaining their bills down. They utilize Michigan’s State Charity Care Law, which gives the Board of Trustees of public hospitals the authority to release a patient from payment responsibility on the grounds of being too poor for repayment. The law essentially allows for trustees to decide without having to adhere to any kind of means testing or income limits. Dollar For advocates on behalf of patients when they discuss billing with the hospital.
Another medical aid program in Michigan is the State Emergency Relief Program, which provides short-term but immediate help. They do have income limits, and eligibility rules.
Health care is an issue Faust has used to connect with people of a variety of political leanings, and seems like a great way to help build a socialist future. Most people in the U.S. dislike or struggle with their health insurance, and addressing this universal issue would be a great way to onboard people who may otherwise balk at eventually joining any socialist project. It would have a direct impact on every American life, and it’s also simply an issue that needs redress- it’s difficult to build a better world if large swaths of us are dying due to being denied one of their fundamental human rights. To that end, this is also an issue we should be pushing politicians to support and make a central part of elections now. While the future of Medicaid is in flux, now is the time to push for not just saving Medicaid, but turning it into a truly single payer system that would provide all care for all people.