Welfare Reform: A Matter of Justice
Medicaid. It is the United States Federal Government program to aid
states in providing health care to the poor and impoverished who otherwise could
not receive proper medical care. In 1995 the federal government spent a
total of $77.4 Billion on Medicaid. This is up almost 300 percent from $20.1
Billion in 1984, only 10 years earlier. In the same 10 years state spending on
Medicaid rose over 250 percent from $16.5 Billion to $58.2 Billion. Under the
current Medicaid programs, Medicaid spending will increase at an annual rate of
10 percent, to an estimated $262 Billion by the year 2002.
Medicaid spending has grown much faster than the general rate of
inflation. For the Federal Government, Medicaid expenditures have grown from
only 1 percent of the national budget in 1970 to over 6 percent in 1995, while
state expenditures went from 8.1 percent to 13.5 percent in the same time span.
This increase can be attributed to multiple factors. First, through a series of
mandates, the Federal Government has expanded the eligibility for Medicaid,
requiring states to serve more people. They also increased the standards
required of nursing homes. This led to higher nursing home costs which were
passed directly back to the Medicaid program. The current average cost to care
for a patient in a nursing home is nine times greater than that of a single
dependent child. The price of medical care, in general, has drastically
increased. Expensive new technology and procedures are a large part of this
increase. The need for these costly new technologies is not expected to
decrease, the cost will just be passed on to the public through higher prices
and higher Medicaid spending. And finally, an estimated 10 percent of Medicaid
payments is wasted on fraud. This is mostly fraud by health care providers,
with a minuscule amount from patients with forged documents.
From 1985 to 1993 Medicaid enrollment has gone up 53 percent. In the
early 1970's, Medicaid recipients were at 8 percent. Today more than 13 percent
of the U.S. is receiving Medicaid's assistance. If there was no Medicaid,
current cuts in employer sponsored medical coverage would have increased the
uninsured population from 41 million today to an estimated 50 million people.
The politicians are finding themselves in a complete catch-22. If they
try to cut Medicaid spending, they fear they will appear cruel and insensitive
to the poor and disadvantaged voters, and also voters who sympathize with their
plight. But if they don't try to cut spending, they will be criticized for not
trying to cure our current budget deficit. But while our elected officials sit
on the fence, trying not to offend anyone, they alienate everyone by not acting
while this Leviathan digs us deeper and deeper into debt.