Republicans Still Have an Opportunity for Free-Market Health Reform in 2018

The Republican tax overhaul significantly undoes the Affordable Care Act by removing the individual mandate to purchase health insurance. Next, the GOP House has their sights on Medicaid reform.

Medicaid expansion is a cornerstone of the Affordable Care Act. The left treats it as sacrosanct, and the right simply abhors it. I have had the privilege to begin my career as a resident physician in Louisiana before and after the state expanded Medicaid. Simply, expansion of Medicaid, the state-federal program for low-income and disabled Americans, will not be society’s cure for indigent health care. It’s equivalent to putting a Band-Aid on a brain aneurysm.

Many of the characterizations of the GOP Senate’s previous healthcare plan as inadequate are reasonable and debatable in a real-world context. However, previous debate missed the point of true reform. The real issue at hand is that the Republicans have an opportunity for pure free-market reform that would actually create the equity the left craves. Continued Medicaid expansion will not be a sustainable long-term solution.

First and foremost, Medicaid is simply bad insurance. The definitive study on the subject in the New England Journal of Medicine noted no substantial improvements in physical health outcomes for two years in patients randomly selected for either having Medicaid or no insurance in Oregon. That’s not comparing Medicaid patients to those with private insurance—it’s comparing Medicaid patients to those with no insurance at all. To be fair, there are certainly positive benefits to having any insurance, and there are some statistical nuances with the study. The differences in outcomes are at least minimal. But they aren’t nearly as large as they should be, given the purpose of insurance and what the program costs.

Medicaid spending will represent nearly half of Louisiana’s $28.6 billion budget in the next fiscal year. Furthermore, Louisiana lawmakers had to add $368 million more in federal funding in May 2017 because they misjudged the age and health status of those who joined. It seems mildly intuitive that the billions spent on Medicaid in the state could have been used in a more efficacious fashion. After all, what are we paying for?