Poor Program’s Progress: The Unanticipated Politics Of Medicaid Policy

Advocates of U.S. national health insurance tend to share an image that highlights universal standards of coverage, social insurance financing, and national administration--in short, the basic features of Medicare. Such an approach is said to be good (equitable and efficient) policy and equally good politics. Medicaid, by contrast, is often taken to exemplify poor policy and poorer politics: means-tested eligibility, general revenue financing, and federal/state administration, which encourage inequities and disparities of care. This stark juxtaposition fails, however, to address important counterintuitive elements in the political evolution of these programs. Medicare's benefits and beneficiaries have stayed disturbingly stable, but Medicaid's relatively broad benefits have held firm, and its categories of beneficiaries have expanded. Repeated alarms about "bankruptcy" have undermined confidence in Medicare's trust funding, while Medicaid's claims on the taxpayer's dollar have worn well. Medicare's national administration has avoided disparities, but at the price of sacrificing state and local flexibility that can ease such "reforms" as the introduction of managed care. That Medicaid has fared better than a "poor people's program" supposedly could has provocative implications for health reform debates.