July 28,2005

Baucus Comments on Medicaid’s 40th Birthday

(WASHINGTON, D.C.) U.S. Senator Max Baucus issued the following statement to ring inMedicaid’s 40th birthday. As ranking Democrat on the Finance Committee, Senator Baucus hasled efforts to protect Medicaid from potential cuts during budget reconciliation. The statementfollows:

On July 30, 1965, President Lyndon Johnson made history when he signed legislation tocreate the Medicaid program. I wasn’t here then. But the distinguished John Dingell was, and Iknow he counts it as one of his proudest moments in the Congress.

Medicaid has grown in the past 40 years from a welfare program to an integral part of ourhealth care safety net. Today, Medicaid provides health and long-term care services for 53million Americans.

Medicaid is a lifeline for our nation’s most vulnerable citizens. For a quarter of ournation’s children and for our low-income elders. For individuals with disabilities and pregnantwomen. For millions, Medicaid means the promise of better health and the chance at a betterfuture.

But Medicaid faces great challenges ahead. Our nation is aging, and its needs for longterm care our growing. As that need grows, so does Medicaid’s cost burden, affecting both stateand federal budgets.

To check rising health care costs and get the most from our Medicaid dollars, we shouldimprove quality in Medicaid, invest in information technology, and create new incentives forbetter health outcomes in the program. We should do the same in Medicare.

At the same time, we must note that problem of rising health care costs is not unique toMedicaid. In fact, a recent study showed that Medicaid cost growth was 6.1 percent, comparedto 12.1 percent for private insurance.

That’s not to say that Medicaid is perfect. We should make the program smarter – moreefficient in paying for drugs, less prone to loopholes, better at dealing with fraud.But as we consider Medicaid reforms, we must do so with an eye toward the right policy,rather than an arbitrary budget number. Medicaid is too important to too many people to dootherwise. Only by making this critical safety-net program smarter and more efficient can weensure that it will be there for generations to come.