Medicaid versus Medicare

In July, President Bush appointed a Medicaid Advisory Commission to propose changes to the massive program. This is an important step to reforming a program truly out of control.

Medicaid has a built-in perverse incentive that all but guarantees unaccountable spending growth by state politicians.

Since 1970, Medicaid spending has grown two times faster than Medicare spending, as a share of national health expenditures.

President George W. Bush’s offer of waivers from Medicaid regulations to states that accept a cap on federal matching funds has the potential to limit spending growth and spark valuable innovation in state programs.

President Bush and the Congress must hold the line against state politicians who simply want to seize more federal cash to bail out their Medicaid programs.

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