Healthcare News & Insights

President Obama vs. Romney on Medicaid

You probably know that if President Obama is reelected, as many as 17 million more American will be on Medicaid, which could put a big strain on U.S. hospitals. But do you know what would happen to Medicaid if Romney wins?

Romney’s plan

He wants to overturn President Obama’s Affordable Care Act and the Medicaid expansion, according to Kaiser Health News.

Instead of expanding Medicaid, Romney would convert it into a block grant to states giving them a fixed annual allotment of money. This approach to Medicaid would save an estimated $100 billion per year by 2016, Romney’s camp estimates.

And according to the Center on Budget and Policy Priorities, repealing the law would cut Medicaid spending by $618 billion over the next decade. Then add on top of that Romney’s additional cuts and the total would be at least $1.4 trillion in cuts over 10 years.

That’s way more money than the Congressional Budget Office said would be saved with the plan for Medicaid that passed the House of Representatives. The House plan to block grant Medicaid would cut spending by $810 billion over 10 years. And the House plan would cover between 14 million and 27 million fewer people in 2021 than are currently covered under Medicaid.

So it looks like Medicaid recipients would have to pay more for their care since the states would be getting less money and have to reduce benefits.

Obama’s plan

The Affordable Care Act, on the other hand, eliminates the varying eligibility rules for Medicaid. And in 2014, it’ll provide Medicaid coverage to all Americans with incomes less than 133% of the federal poverty level. Translated, that means that if all states agree to the change, as many as 17 million more people will be on Medicaid over the next decade.

This expansion is optional for states and a number of Republican governors have already refused to take the extra money to expand the program. For those that do take it, the federal government will pay the full cost for people newly eligible for Medicaid from 2014 to 2016. After that, states have to start contributing, but no more than 10% by 2020.

For people who are eligible now, states will receive their current federal funding match rate.

States that would benefit most from Obama’s plan would be those with the tightest eligibility for Medicaid and a large percentage of uninsured citizens, such as Florida, Texas and Mississippi.

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