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Commentary

Florida's Medicaid Gamble
The New York Times, 10-24-05

The New York Times is not, as a rule, a proponent of business deregulation or market driven health care, but they certainly deserve a hat-tip for this editorial on the recent decision by the Department of Health and Human Services to grant Florida’s Medicaid program a waiver for wide-ranging consumer-driven reforms.

State officials believe the new approach will save money in the long run because the managed care plans will have incentives to screen patients aggressively, treat problems early, before they become horrendously costly, and manage a patient's care in a cost-effective manner. They also believe there will be less opportunity for fraud and abuse. …
Florida's plan is the first to inject competition and consumer choice into Medicaid, and it may well serve as a model for other states if it works out. There is good reason to be wary of this approach. But advocates who support more traditional government spending can't hope to make their case if they resist tests of other approaches. The experiment is surely worth a try.

Kudos to the Times for, despite its evident skepticism, giving Florida’s program the benefit of the doubt for the time being. But the editorial is also worth reading for the very dark picture it paints of the current Medicaid program. The proponents of traditional Medicaid spending (spend early, spend often) have had their way for decades, and vulnerable patients have been left with an expensive, patchwork system run by bureaucrats that is teetering on the verge of fiscal collapse.

The Medicaid model is broken and, as with welfare reform, market advocates deserve a fair chance to try their ideas out. Hopefully, Florida and other states testing similar reforms will make the Times a true believer.



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