As this article from the Albuquerque Journal notes, liberals hate the idea of block granting Medicaid. The governors’ letter cited in the column can be found here. Of course, the myth is that Medicaid is a particularly effective federal program that does great things for low income and needy families. The reality is far different as the “low wage trap” chart on page 3 from Cato’s Michael Cannon illustrates. Contrary to improving the lives of the poor, the way the system is set up, it is very difficult for low income families to get ahead.
The reality is, as Cannon points out in this column, that Governors who like Medicaid like it because it is a source of “free” money. They don’t have to be responsible for managing limited resources effectively because the federal government is there to bail them out. New Mexico, under Gov. Richardson, took this attitude. And, Voices for Children which is run by far left-wing legislator Eric Griego, believes that New Mexico’s living at the expense of taxpayers in other states is a good thing! Thankfully, Gov. Martinez did not sign this letter and has not fallen for the left-wing claptrap on Medicaid.
Medicaid is just one unsustainable portion of both the federal and state budgets. Block granting worked in the 1990s under Clinton when welfare reformed. It can and must work again with Medicaid.