An influential aide to the President is reportedly telling State officials that the Obama Administration will encourage, and will not object, to the previously unauthorized use of Medicaid subsidies to pay Premiums to Private Insurance Companies. The use of this Federal money is not authorized by the Affordable Care Act. I am not aware of any other Federal Statute authorizing it. The Health Insurance Coverage provided by private, commercial Health Insurance Carriers is almost always less than the Coverage that Medicaid provides (which is one reason Congress enacted Medicaid in the first place).
This is certainly a policy shift which echoes the use of Federal Funds to pay money directly to investment banks once the Troubled Assets Relief Program ("TARP") passed Congress on the representation that TARP funds would be targeted to relieve troubled homeowners in the general public. Now, Federal Medicaid money will reportedly be shifted by the Obama Administration from paying for Medicaid. Instead, the Federal Medicaid subsidies will be made available to purchase commercially provided Health Insurance from private Health Insurance Companies. See Robert Pear, "Expanding Medicaid With Private Insurance / A Sharp Departure On Health Care Law" p. A14, col. 6 (New York Times Nat'l ed., Friday, March 22, 2013).
To rephrase a line from a poem by Robert Frost, "You can't call it Medicaid, 'cause it ain't."
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