The pandemic emergency is over — the administration should acknowledge it

Fewer than 1 in 10 Americans now consider COVID-19 to be a crisis, according to the latest Axios-Ipsos survey. But while the public has moved on, the Biden administration has not, extending the two-year-old COVID-19 public health emergency for another 90 days.

In light of positive trends, the emergency should be allowed to expire in July. In any event, lawmakers should decide what to do about the temporary policies put in place to fight the disease. Some, like telehealth access, should be maintained. Others, like the temporary expansion of Medicaid, should be allowed to expire.

Thanks to temporary policies adopted by Congress early in the pandemic, the number of Americans enrolled in Medicaid, the joint state-federal health care program for the indigent, swelled by more than 20 percent, or nearly 15 million people, bringing total enrollment above 80 million for the first time.

An estimated six million of them are ineligible under the program’s permanent, pre-pandemic rules, but the states are prohibited from disenrolling them until the federal emergency is allowed to expire.

Advocates of government-run health care want to keep these ineligible people on the rolls indefinitely. That would be a mistake. Medicaid is meant to be a safety-net for the truly needy, not an ever-expanding entitlement.

It is also one of the most wasteful programs in government. Its improper payment rate — money wasted, stolen, or paid in error — is now a staggering 21 percent of total program outlays, up from just 8 percent three years ago. To put that in perspective, the $143 billion Medicaid misspent in 2018 and 2019 is more than the entire budget of 48 U.S. states — and more than the GDP of 134 countries.

About three-quarters of that money is being used to cover enrollees who are no longer eligible for benefits, for example, because their income has risen. Instead of permanently expanding this troubled program, we should let it return to normal and reform it.

Program spending has been growing 2.5 times faster than state revenues. Since 2000, Medicaid has grown from 20 percent of all of state expenditures to 30 percent and has begun to crowd out other public services. A 2018 Harvard study found that for every $1 increase in Medicaid spending, state per-pupil higher ed spending decreased by $2.44, making Medicaid growth the “single biggest contributor to the decline in higher-education funding at the state and local level.”

That’s one of the reasons 12 states have refused Washington’s promise of “free” money to expand Medicaid to cover able-bodied, mostly childless adults under ObamaCare. This “promise” of “free” money has proved false. States that take it spend 157 percent above original estimates, on average, thanks to per-patient cost overruns of 76 percent.

Sadly, states often try to control Medicaid’s costs by stinting on the amount it pays doctors and hospitals. As a result, one-third of doctors now simply refuse to accept Medicaid patients, leading to substandard care.

It’s time to restore Medicaid to its original mission as a safety net for the truly needy — and in the process give patients more personalized options so they have more choice and control over their care.

Today, Medicaid subsidies go, not directly to patients, but rather to providers and insurance companies. It’s time to reverse that by helping enrollees afford high-quality private health insurance that they own and control and that’s tailored to their needs.

We should also expand Americans’ access to tax-free health savings accounts and help fund the accounts of low-income families, using some of the money we currently send to insurers. 

Also, let’s give Medicaid enrollees access to direct primary care, an exciting new model that gives you direct access to basic medical care, preventive services, and generous drug discounts, all for a flat monthly fee, and with no insurance company meddling. A family DPC subscription typically costs less than $100 a month.

Most of the six million ineligible enrollees are eligible for alternative forms of coverage, including employer-sponsored and federally subsidized insurance. And thousands of free clinics deliver excellent care to the needy every single day. 

Keeping millions of people who don’t need the help enrolled in a broken Medicaid program is not compassion, it is a missed opportunity. There is a better way, one that begins with empowering patients.

The end of the pandemic emergency offers a perfect time to make the safety net stronger and better for everyone.

Dean Clancy is senior health policy fellow at Americans for Prosperity.