[[link removed]]

REPUBLICANS PREPARE TO GUT MEDICAID  
[[link removed]]


 

Paul Krugman
February 27, 2025
Paul Krugman Substack
[[link removed]]


*
[[link removed]]
*
[[link removed]]
*
*
[[link removed]]

_ Republicans West Virginia helped put in power are preparing to
impose savage cuts on a program that has literally been a lifeline for
many in the state, in order to help offset the cost of huge tax cuts
for high-income Americans... Populism! _

Two Missouri Hospitals Closing, in Kansas City and Liberty will be
completely and permanently closing on or about November 12, 2024.,
Photo credit: KHMO AM 1070

 

West Virginia is a very red state; Donald Trump received more than two
thirds of its votes last year.

It’s also a poor state, left behind by the 21st century economy.
Because incomes are low, it pays very little in federal income taxes
— less per household
[[link removed]] than
any other state.

However, at least the great majority of West Virginians — more than
94 percent — have health insurance. The reason for this good news is
that unlike many red states, WV accepted Medicaid expansion under the
Affordable Care Act, which was passed in 2010 but didn’t fully go
into effect until 2014. The effect was dramatic; Medicaid now covers
more than a quarter of the state’s population:
 

And Medicaid covers _45 percent_ of the state’s children.

But now the Republicans West Virginia helped put in power are
preparing to impose savage cuts
[[link removed]] on
a program that has literally been a lifeline for many in the state, in
order to help offset the cost of huge tax cuts for high-income
Americans, hardly any of which will trickle down to WV voters.
Populism!

We’ll be hearing a lot of lies about Medicaid in the weeks ahead,
starting with Trump’s arithmetically impossible claim last week that
Medicaid won’t be “touched” by the planned spending cuts. So
here are two things you should know about a program Trump and his
allies have in their crosshairs: it’s extremely important to many
Americans, and it’s much more cost-efficient than the rest of our
health care system.

_Medicaid is really, really important_

I often encounter generally well-informed people who are surprised to
learn that Medicaid is a much bigger program, in terms of the number
of people covered, than Medicare — 69 million versus 48 million
[[link removed]].
The perception that Medicare is much more important may reflect the
fact that Medicaid still costs taxpayers less than Medicare. This is
partly because older people have higher health costs than the young
adults and children who make up much of the Medicaid population. But
it’s also because Medicaid is quite cost-efficient; more about that
shortly.

There’s also, let’s be frank, a perception that Medicaid
is _politically_ unimportant, that conservatives can safely target
it for cuts, because it’s mainly a program for inner city people of
color. But that was never as true as people imagined and is definitely
not true now. Again, consider West Virginia. It’s one of
America’s most rural states
[[link removed]] and
overwhelmingly — 90 percent
[[link removed]] —
white. Yet as we’ve seen, it’s deeply dependent on Medicaid.

In fact, Medicaid is especially important for rural and small-town
Americans, even if they aren’t beneficiaries themselves, because it
helps keep health care accessible.

Hospitals have been closing
[[link removed]] across
much of rural America, because there aren’t enough paying patients
to keep them operating; the picture at the top of this post shows one
such hospital, in Cuthbert, Georgia. Georgia is one of the states
that, unlike West Virginia, refused to accept a federally-funded
expansion in Medicaid under the Affordable Care Act. As a result,
fewer Georgians are able to pay for medical care. Rural hospital
closures have been overwhelmingly concentrated in these
“non-expansion” states.

All in all, if Republicans think they can slash Medicaid without
paying a heavy political price, because only Those People will be
hurt, they’re going to be mightily surprised. According to one
recent poll
[[link removed]],
71 percent of _Trump voters_ say that cutting Medicaid would be
unacceptable.

_Medicaid is cost-efficient_

Some conservatives claim that we can achieve big cuts in Medicaid
outlays by eliminating wasteful spending, because that’s their rote
line. And there’s surely some waste in Medicaid, as there is in any
large program. But there is nothing comparable to the massive
overpayments Medicare makes to insurance companies selling Medicare
Advantage
[[link removed]] plans.
Funny how that never comes up in conservative diatribes against waste,
fraud and abuse.

In fact, compared with other parts of the U.S. health care system,
Medicaid stands out for its remarkably low costs. Making comparisons
among different types of insurance coverage can be a bit tricky,
because the populations are different; for example, people in poor
health often have low incomes, and hence qualify for Medicaid. But
careful comparisons that adjust for these differences
[[link removed]] find
that Medicaid is a _lot_ cheaper than private health insurance:

How does Medicaid manage this? It has lower administrative costs than
private insurance, in part because it doesn’t have to devote
resources to marketing, determining eligibility, denying coverage, and
so on. It also pays providers less, which can sound like a bad thing
until you realize that this includes things like bargaining for lower
prices on drugs and medical equipment.

I’m not an expert here, but my understanding is that Medicaid, as a
program for low-income Americans, has something that, for different
reasons, neither Medicare nor private insurers have: The ability to
say no. No, we won’t pay for that expensive drug being advertised on
TV when there’s a much cheaper alternative that’s equally
effective, or close to it. No, we won’t pay inflated prices for
medical procedures of dubious effectiveness. And the ability to, say,
exclude overpriced drugs from Medicaid’s formulary unless the pharma
company cuts its price gives Medicaid a lot of bargaining power.

Does this low cost lead to low-quality coverage? Medicaid recipients
may sometimes have trouble finding a doctor, because of those lower
payments. Yet according to patients themselves
[[link removed]],
Medicaid does fine — Americans on Medicaid are roughly as satisfied
with their coverage as those with employer-sponsored insurance:
 

Furthermore, those in poor health, who need health coverage most,
appear to be significantly _more_ satisfied if they get their
coverage from Medicaid than those getting insurance through their
employer:

 

All in all, if you were looking for a way to reduce America’s
extremely high health care costs without reducing the quality of care,
Medicaid actually looks like a model rather than a problem case.

Oh, and a quick word about work requirements for Medicaid recipients,
which are all too likely to be part of what Republicans try to impose:
They’re basically a fraud. There are almost no Americans choosing
not to work because they can live on government benefits instead; our
social safety net isn’t generous enough for that. The real purpose
of work requirements is to create more hoops for people to jump
through, to make it harder to collect the benefits they’re legally
owed.

_Cruel and usual_

I don’t know whether draconian, cruel cuts to Medicaid will actually
happen. It may turn on whether Republicans in Congress are more afraid
of their constituents or of Donald Trump.

But what is worth noting is that what we’re seeing is that for all
the talk about how the G.O.P. is now the party of the working class,
the policy agenda is as cruelly plutocratic as ever: Take away health
care from Americans who need it so you can cut taxes for the wealthy.

MUSICAL CODA

One of many covers, but this one is special. Btw, Larkin Poe is the
name of the band, a distant ancestor of Rebecca and Megan Lovell
 

[[link removed]]

WATCH AND LISTEN - CLICK ON RED ARROW ABOVE, OR CLICK HERE
[[link removed]]

Subscribe to Paul Krugman [[link removed]]
Tens of thousands of paid subscribers
Notes on economics and more
 

* Medicaid
[[link removed]]
* social safety net
[[link removed]]
* Donald Trump
[[link removed]]
* Trump Budget
[[link removed]]
* Trump tax cuts
[[link removed]]
* West Virginia
[[link removed]]
* Health Care
[[link removed]]
* Red States
[[link removed]]
* Affordable Care Act
[[link removed]]
* Congress
[[link removed]]
* GOP
[[link removed]]
* MAGA
[[link removed]]
* Republican Party
[[link removed]]
* Elections 2026
[[link removed]]
* 2026 Midterms
[[link removed]]

*
[[link removed]]
*
[[link removed]]
*
*
[[link removed]]

 

 

 

INTERPRET THE WORLD AND CHANGE IT

 

 

Submit via web
[[link removed]]

Submit via email
Frequently asked questions
[[link removed]]
Manage subscription
[[link removed]]
Visit xxxxxx.org
[[link removed]]

Twitter [[link removed]]

Facebook [[link removed]]

 




[link removed]

To unsubscribe, click the following link:
[link removed]