Medicaid: Congress Not Serious About Spending Discipline

Armen Hareyan's picture

"Congressis currently resisting" new Medicaid regulations that "attempt torein ... in a Big Con that everyone acknowledges": states "have beengoosing their financial arrangements to maximize their federal payout and dumpmore of their costs onto taxpayers nationwide," the Wall Street Journal writes in an editorial. Accordingto the Journal, "Congress promptly forbade enforcement of thenew regulations" and "wants to extend" a moratorium on them"until President Bush leaves office," which would allow states to"revert to their con artistry, knowing they are no longer beingwatched."

The Journal writes that an "alternative would be for thegovernment to distribute block grants, rather than a set fee for every Medicaidservice," which would "amputate Washington from state accounting andinsulate taxpayers from these shakedowns." The editorial adds,"States would have an incentive to spend more responsibly and also craftinnovative policies without Beltway micromanagement."

The editorial states, "In the short term, Congress could -- but probablywon't -- allow the administration to close this case." The Journalwrites, "No one really knows how much the state grafters have alreadygrabbed," but according to the CongressionalBudget Office, thenew rules would save $17.8 billion over five years and $42.2 billion over adecade. The Journal concludes, "We realize this is considereda mere gratuity in Washington,but Medicaid's money laundering is further evidence that Congress isn't seriousabout spending discipline" (Wall Street Journal, 5/19).

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