<!--:es-->«Ridiculous» Obama Administration Blocks Modest Medicaid Reforms in Illinois<!--:-->

«Ridiculous» Obama Administration Blocks Modest Medicaid Reforms in Illinois

There are a lot of people out there who think that, just because Medicaid is jointly run by the states and the feds, that states have a great deal of flexibility in how they administer the program. As Harold Pollack happily puts it in The New Republic, “In practice, states already enjoy great flexibility, with the Obama administration sending many signals that it is wiling to grant more.”
The logic of Harold’s argument is clear: if states “already enjoy great flexibility,” there’s no need to give them more flexibility in the form of block grants. Doing so would only give state governments “more incentive to make deeper cuts.” So I thought I would share with you an example of how ludicrously inflexible Medicaid really is: an example from Illinois, President Obama’s home state.
Illinois has one of the most expansive Medicaid programs in the country, with annual state and federal spending of $15 billion. That compares to a state budget of $33 billion. In the Land of Lincoln, you can qualify for Medicaid if your income is under 200 percent of the federal poverty level—$44,700 for a family of four. Children qualify at 300 percent of FPL. One out of every five Illinoisans is on Medicaid, including one-third of all Illinois kids.
But in order to prove that you’re eligible for Medicaid in Illinois, all you have to do is provide a single pay stub. If that pay stub happens to be artificially low, suggesting a lower income than you actually have, it still counts as “proof” of Medicaid eligibility. As to proving Illinois residency? The nice people of Illinois merely ask that you write down your address. As a result, people earning more than the Medicaid threshold, and people who don’t even live in Illinois, are collecting Illinois Medicaid funds.
So in January, the State of Illinois, under a Democratic House, a Democratic Senate, and a Democratic Governor, passed a landmark Medicaid reform bill aimed at fixing this and other problems with the program. The new law required the state’s Medicaid recipients to provide a month’s worth of pay stubs, instead of just one, in order to provide evidence of residency and income. Not a big deal, you might think.
You’d be wrong. In July, the federal Centers for Medicare and Medicaid Services informed Illinois that the seemingly innocuous reform violated federal law, because Obamacare doesn’t allow states to restrict Medicaid eligibility, and this reform, they decided, was an eligibility restriction. From the Chicago Tribune:
Sen. Radogno is right—it is absolutely ridiculous. And it’s just one example of the dysfunctional way we run Medicaid today. The money that Illinois wastes on ineligible Medicaid recipients could be better spent helping the truly needy. When Democrats in Washington stop Democrats in Illinois from enacting basic Medicaid reforms, the system is broken.
Block grants are the fulcrum of Medicaid reform. By giving states control over Medicaid dollars, the program can be run more efficiently, directing more resources to those who truly need them, thereby improving Medicaid’s disastrous health outcomes. Liberals are always telling us about wasteful health-care spending. So why not let those closer to the problem try to do something about it?