Bill Clinton famously promised to “end welfare as we know it;” Joe Biden inexplicably claimed to have “finally beat Medicare.” But unfortunately, neither of them reformed what is now America’s largest welfare program, leaving President Donald J. Trump with a colossal mess.
America now faces a dependency epidemic far worse than the ‘90s crisis that spurred bipartisan reform. “Welfare as we know it” is now an endless, universal-style Medicaid program that prioritizes those who are capable of working over those who have nowhere else to turn.
While enrollment has started to taper off, the program has recently hit record levels, approaching nearly 100 million in recent years. As of today, approximately 1 in 4 Americans are Medicaid dependent, making Medicaid twice the size of the food stamps program.
At the end of 2022, able-bodied adults made up 44 percent of the program–nearly half!
Clearly, this is not your grandmother’s Medicaid program.
The primary culprit is the so-called “Affordable Care Act,” or what most Americans call Obamacare. As part of their march towards universal health care, its architects abandoned any pretense of reserving Medicaid for the needy and blew the door wide open, extending Medicaid coverage to childless adults, with incomes significantly above the poverty line, a stark contrast to the limited coverage that previously existed for extremely low-income families.
But don't assume that because eligibility goes well above poverty that these enrollees are working. Quite to the contrary, the vast majority of them do not work at all.
And why would they? Obamacare expansion essentially pays them not to work, giving them endless Medicaid coverage with no work requirements and no time limits. Unlike other major welfare programs, there are no mechanisms whatsoever to move adults up and out.
By the end of 2022, there were nearly 25 million able-bodied adults in the Obamacare expansion program alone.
The problem is so bad that elderly and disabled individuals now account for less than a third of Medicaid. That is to say, the people the program was created for now make up less than a third of it.
(Think about that in the context of a different government program. What if only a third of federal child care subsidies went to families and the rest went to 19-year-olds without kids? That’s what’s happening in Medicaid right now.)
And, if that wasn’t bad enough, Obamacare masterminds also created a wholly immoral funding formula that pays states significantly more for every dollar they spend on able-bodied adults and incentivizes them to cut from the truly needy first.
We recently discovered that Arkansans with severe disabilities are forced to wait a decade on average for needed Medicaid services. Many of them are nonverbal children with severe debilitating conditions.
All the while, taxpayers are forced to spend billions to provide top tier Medicaid benefits to able-bodied, working-age adults through Obamacare expansion. It’s a moral outrage.
Expansion has also added trillions to the national debt, saddling future generations with the bill–all for a program that has been proven not to improve physical health.
Regrettably, my home state of Arkansas sticks out like a sore thumb when it comes to the devastating impacts of Obamacare expansion. After more than a decade of throwing money at this broken program, Arkansas’s Medicaid budget has more than doubled, with more than $1 of every $4 we spend going to feed the Medicaid monster.
Nearly one in three Arkansans are now dependent on Medicaid.
And after all that, Arkansas still ranks near the bottom in virtually all health outcomes. After a decade!
It’s total and complete madness–and Congress has not only a mandate but a moral obligation to fix it.
Thankfully, the Trump administration has made it clear that getting federal spending under control is a top priority, ensuring that every taxpayer dollar is spent wisely. Medicaid reform should be at the top of the list.
One non-negotiable should be work requirements, which have been proven time and time again to help able-bodied adults increase their incomes, reduce government dependency, and produce massive savings for taxpayers. (And yes, my home state of Arkansas also proved that they can work in Medicaid, too.)
Congress should infuse work into Medicaid for all able-bodied adults, as soon as possible, bringing Medicaid into alignment with all other major welfare programs and helping millions of Americans move from welfare to work.
Congress should also throw Obamacare’s immoral funding formula onto the ash heap of history. It’s unfair to both taxpayers and to the truly needy Americans that rely on traditional Medicaid.
Both of these commonsense changes would produce massive savings for taxpayers while not taking a penny away from the truly needy. In fact, these reforms would help the truly needy by freeing up resources for them and making Medicaid significantly more sustainable.
“Welfare as we know it” today is much worse than it was thirty years ago. But there’s a proven blueprint for how to course correct; we just need leaders willing to lead. And Americans will prosper if they do.
Nic Horton is the Founder and CEO of Opportunity Arkansas, a nonpartisan policy organization working to simplify government and solve generational problems in the Land of Opportunity. To learn more, visit OpportunityArkansas.org.
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