(Bloomberg) — Mehmet Oz, the US Centers for Medicaid and Medicare Services leader, suggested he supports reducing federal Medicaid funding for the millions of people who gained access to the program through the Affordable Care Act.
The US government pays for a larger share of the medical costs for those people, compared with individuals who qualify for conventional Medicaid. Oz claimed that meant federal tax dollars were being siphoned away from the country’s sickest and most vulnerable to cover relatively healthier people.
“Because we pay 90% of the money for the able-bodied person and only, let’s say, 65% for a traditionally Medicaid poor, young, old or disabled person, it actually moves money to the able-bodied population,” Oz said at the Milken Institute Global Conference in Los Angeles on Monday.
The Affordable Care Act, signed into law by Barack Obama, allowed states to expand their Medicaid programs to insure people who made up to 138% of the federal poverty level. More than 20 million people across the country are covered through the expansion as of June 2024, according to the nonpartisan health research and polling firm KFF.
Ten states haven’t expanded their Medicaid programs.
House Republicans seeking for ways to pay for tax cuts have considered cutting the rate of federal support for Medicaid coverage for the expansion population. However, some members from states that have expanded Medicaid have voiced opposition to the idea, including New York Representative Mike Lawler.
Reducing federal funding could either leave states with budget holes, or prompt them to drop the Medicaid expansion altogether and leave people uninsured. Some states have laws that would automatically trigger an end to expanded Medicaid coverage if federal funding falls below a certain threshold.
Fewer enrollees in Medicaid could also hurt the bottom lines of private insurance companies that work with states to administer the programs.
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