Healthcare has been an increasingly common area of debate since the Trump administration announced cuts to Medicaid. My goal is to present the arguments made by both sides to allow for critical yet informed opinions to form regarding this issue. Many of us listen to what the media mentions and debates because reading through entire pieces of healthcare legislation is tedious and time consuming. Critically assessing both approaches to healthcare will always provide more useful information than the media.
Medicaid, created in 1965, is a public health insurance program that covers low income families, children and individuals. It is funded by both the federal and state governments. The federal government pays states for a share of program expenditures, called the Federal Medical Assistance Percentage (FMAP). 74 million people are covered by this program, and 600,000 more have been covered since the expansion of Medicaid. There are arguments made by both Democrats and Republicans regarding the effects of Medicaid. In order to formulate a holistic opinion about this issue, it is necessary to understand the logic behind both arguments. There has been a lot of debate on the economic effects of Medicaid spending. One point of view is that “this increased spending will result in more than 39,000 jobs in 2016 and 30,000 jobs in 2021, with two-thirds of these jobs outside the health care sector.” This is because this spending contributes to the physical ability of individuals to work. Many view the health benefits of these programs to increase labor participation which in turn increases income and spending, so health contributes to economic booms. The Trump administration mentions the Affordable Care Act (ACA) as a negative element of public health insurance because in providing more government subsidies and programs that will increase enrollment and eligibility, it has caused premiums (“the amount you pay for your health insurance every month”) healthcare.gov/glossary/premium/ to increase. This means that less people will be able to afford health insurance and will therefore be dependent on public healthcare. https://khn.org/news/one-on-one-with-trumps-medicare-and-medicaid-chief-seema-verma/
In essence, what Trump and his team are trying to do is omit regulations on health insurance that drive up premiums, to create more affordable health insurance and a lower dependence on Medicaid. This is drastically different from what we have seen in the Obama administration with the ACA, which increased government subsidies to widen the scope of public coverage. The Trump administration has challenged this approach, claiming it leads to higher premiums and taxes. “Each state has its own FMAP based on per capita income and other criteria.” The decrease in spending on Medicaid would lower taxes for income earners and even firms, allowing for more disposable income for consumers and disposable revenue for firms to use on hiring. With the undeniable decrease in unemployment, it is possible to shift more coverage from the public sector, government provided insurance, to the private sector, employer provided insurance. With more employed workers, it is possible that Trump is expecting employers to cover those people rather than Medicaid. This could very well be the explanation to scaling down Medicaid.
Many employers, while expanding hiring, may not provide employees with health benefits. With this plan, the Trump administration is overlooking a population group that is employed yet not insured. For instance, a minimum wage worker could be making enough money to lose qualification for Medicaid now that it is shrinking, and is not provided with health insurance benefits and will lose coverage completely. Bringing in Obama-era elements into this Trump-era plan allows for an approach that addresses multiple points of view. Perhaps there should be regulations and increased government involvement with firms that require them to provide employees with health insurance before reducing Medicaid funding. Doing this would decrease dependence on public health insurance, and save taxpayer dollars, but would also ensure that there is no group of individuals who are overlooked by both private and public health insurance, to provide everyone with affordable insurance.
In order to come up with a health insurance plan that works well for the majority of Americans, it is crucial to look at the goals and strategies of both Democrats and Republicans regarding healthcare. Doing so will bridge the tension growing between the parties and allow us to look past a politician’s party affiliation and learn about an issue from multiple perspectives.
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Keren Blaunstein is a contributor for The Daily Campus. He can be reached via email at email@example.com.