This is a question that’s stirred some debate recently. Republicans have always considered Medicaid—a means-tested public benefit that’s received based on income guidelines, much like TANF or food stamps—to be welfare. Democrats lately have been contending that it’s not, especially within the context of the Medicaid expansion debate.
So, what do others have to say?
It’s telling that Pennsylvania, a state whose decision to expand Medicaid under the ACA is being touted by Maine Democrats, places its Medicaid program within the state’s “Department of Public Welfare.” The Department’s home page lists “Medical Assistance” (the name for Pennsylvania’s Medicaid program) right next to Cash Assistance and Food Stamps when directing visitors to apply for benefits.
Idaho’s Medicaid program similarly falls under that state’s Department of Health and Welfare.
In Nevada, the Division of Welfare and Supportive Services determines eligibility for the Medicaid program.
Most states administer their Medicaid program under the same cabinet-level department as the rest of their welfare programs, such as cash assistance, food stamps, and rent subsidies. If it’s really health insurance—as Democrats claim—and not welfare, wouldn’t Medicaid be administered by the states’ departments or bureaus of insurance?
The University of Pennsylvania’s School of Social Work considers Medicaid to be welfare, classifying it as non-cash assistance right next to Food Stamps and rent subsidies.
Even the American Association of Retired Persons (AARP) considers Medicaid to be welfare.
Merriam-Webster Dictionary defines welfare, in part: “a government program for poor or unemployed people that helps pay for their food, housing, medical costs, etc. [emphasis added].”
The Portland Press Herald, citing this definition, has concurred that Medicaid is, indeed, welfare.
Historically, Medicaid has always been cognizable as a welfare program, being signed into law originally as a part of President Lyndon Johnson’s “Great Society” initiative and factoring largely into the 1996 federal welfare reform law. In fact, prior to the national welfare reform, Medicaid coverage used to be automatically extended to those who receive cash welfare benefits.
As a means-tested public benefit that’s granted based on income guidelines, it has much more in common with Food Stamps and TANF than it does with Medicare or Unemployment Insurance, which are granted by virtue of age or employment, not means.
So why does this all matter? Is it just a semantic argument or are there real policy implications for how we conceive of Medicaid?
Of course, Medicaid, like many other public benefits, is of vital importance for the truly needy in our society. Many children and elderly and disabled Mainers rely on this program. Republicans put an emphasis on fiscal conservatism in part because we want our social safety net to be sustainable.
But a growing number of Mainers and Americans believe that it’s not just the truly needy who are reaping the benefits of welfare. The safety net is becoming a hammock for some, and our most vulnerable neighbors are slipping through the netting. The safety net works when it holds only those who need it most. However, when distributed to one-third of the state, as Democrats are proposing with Medicaid, welfare creates disincentives to work and crowds out scarce funding for those whom it was originally intended to serve.
Furthermore, expanding medical welfare again would wreak fiscal havoc on Maine’s budget. Past expansions left us with a $500 million hospital debt that we only just paid off thanks to Governor LePage’s persistence, and Medicaid-induced budget shortfalls continue to plague Maine taxpayers year after year. Maine’s Medicaid program has doubled as a share of our state budget in just 15 years and now ranks as the third-largest in the nation.
There are alternatives. Maine Republicans have implemented reforms that are bringing down the cost of health insurance. Also, most of the people Democrats are proposing to cover with welfare expansion are soon eligible to buy federally-subsidized private health insurance for as little as $5 per week at no cost to the state.
People’s frustration with welfare spending and overuse means that Democrats can’t sell another expansion of medical welfare unless they cast it as “free health care.”
So yes, it’s natural for Democrats to resist the term “welfare” as a descriptor of Medicaid. They don’t want to be the party of expanding welfare.
But that’s what it is, and that’s what they are.