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    Medicaid, created in 1965, is a public insurance program that is designed to provide health coverage to low income individuals and families, of which include children, parents, elderly, and those who are disabled. Medicaid has sought to ensure that low-income families would never go without essential healthcare, but there is one problem with the current system; it is bankrupting America. Medicaid, Medicare, and Social Security all face structural problems that are driving them into bankruptcy and without structural changes from Congress the system will not continue to work. Medicaid and Medicare are key drivers of inflation in the federal budget.

    . The federal government currently matches state dollars spent on Medicaid, but at the same time dollars cut from the state budgets causes more than a dollars worth of cuts in federal funding. Incentives like these cause states to expand this program. According to the House Republican budget proposal by Rep. Paul Ryan, if nothing is done to reform this system, more citizens will just be funneled into a broken system with lower quality care and fewer options.

    The House Republican budget aims to end the current on-size-fits all approach by converting the federal share of Medicaid spending into a block grant that would give the states the flexibility to design their Medicaid program to fit their specific needs. Another proposal is to allow the states the ability to offer their Medicaid populations more options and better access to care. These recipients have the right to choose their own health care decisions, including who their doctor will be. These proposals, according to the budget would save $750 billion over a ten year period.

    While it may cut federal spending and reduce the nation's debt, the real concern here is the millions of individuals that would be left uninsured under the Ryan plan. This block grant would start in 2013 and would cap federal funding levels much below what the existing system provides. Medicaid funding would be cut by 35 percent by 2022 and 49 percent by 2030, according to the Congressional Budget Office. This sharp shift cost to the states would mean that they would have to boost their contributions to Medicaid or use the greater flexibility that the block grants would provide to make deep cuts in eligibility, health and long term care services, and provider reimbursement rates.

    The Center on Budget and Policy Priorities did a study on what would have happened if Ryan's plan would have gone into effect in 2000 and ended in 2009. The findings were that the states would have received $350 billion less over this period than they really did, and in 2009 alone the cuts in federal funding would have equaled $63.5 billion. The plan would have hit all states hard over this period, some states worse than others. Michigan would have received a 22 percent cut overall in an economy that is already struggling. For a state that has one of the highest unemployment rates in the country and has been so affected by the recession this would have likely led to substantially more uninsured residents.

     

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    About Us

    The Michigan Policy Network is a student-led public education and research program to report and organize news and information about the political process surrounding Michigan state policy issues. It is run out of the Department of Political Science at Michigan State University, with participation by students from the College of Social Science, the College of Communication, and James Madison College. 

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    Meet your Policy Fellow: Leah Brynaert

    Leah Brynaert is Health Care Fellow & Correspondent for the Michigan Policy Network. She is a first-year student in Lyman Briggs College at MSU.