Research & Commentary: The Medicaid "Cure"

Published December 28, 2012

The United States Department of Health and Human Services (HHS) has told the states there will be no flexibility in implementing Medicaid expansion: either expand fully or don’t expand at all.

The announcement came as states were hoping to receive extra federal assistance by expanding their programs only partially: for example, inquiring as to whether they could expand to cover individuals whose income is 100 percent of the poverty level instead of 138 percent. HHS wrote to U.S. governors prohibiting that possibility.

HHS did, however, leave states with something to consider: Section State Innovation Waivers. States can request a waiver to offer alternative coverage. States won’t receive the 100 percent reimbursement rate, but they could propose plans they deem more likely to benefit the neediest residents of their states.

With waivers available and encouraged, what is a strong reform option for states to consider? According to the Foundation for Government Accountability (FGA), the answer may be Florida’s “Medicaid Cure.”

A pilot program established in five large Florida counties by Gov. Jeb Bush, the Medicaid Cure is a premium support model in which 290,000 Medicaid recipients are given a range of premiums and plans from which to choose. The premium range is built using the actual history of the state’s Medicaid patients, and the program offers choice counseling to the recipients, helping them to identify which plan is most suitable for their needs.

The program has yielded extraordinary results for the state and the Medicaid recipients. Patients are more engaged in their plans than is true under typical Medicaid programs, with a reported 70 percent choosing a plan other than the default option and 64 percent taking advantage of cash incentives to live healthier, such as choosing to quit smoking. According to the Florida Agency for Health Care Administration, the program has resulted in 64 percent better health outcomes than those seen under managed care, and 83 percent of recipients report they are more highly satisfied.

The state saved approximately $118 million a year on Medicaid in the five counties in the program. Rather than recklessly expanding Medicaid and surrendering more authority to the federal government, states should seek options like the Medicaid Cure that reduce costs and offer better care.

The following documents offer additional information about the Medicaid Cure and other reform options.

New Developments in Medicaid Expansion
The Council of State Governments explains the U.S. Department of Health and Human Services decision not to allow partial expansion of Medicaid.

As States Consider Program Expansion, Focus Turns to Florida Medicaid Cure–commentary-florida-considering-block-grants-for-medicaid
In an article for Health Care News, Managing Editor Benjamin Domenech details the success of the Florida Medicaid Cure and the options and incentives it provides to participating recipients.

A Medicaid Cure: Florida’s Medicaid Reform Pilot
The Foundation for Government Accountability gives insight into the Medicaid Cure’s success, stating, “When the patient is the priority, government and HMO bureaucrats are finally held accountable. Costs flatten and patient health and satisfaction improves.”

State Medicaid Waivers and the Rhode Island Model
In this Heartland Institute Research & Commentary, Kendall Antekeier explains Rhode Island’s Global Consumer Choice Compact Waiver, approved in 2009, and how block-granting gives states more flexibility over how they run Medicaid and manage its costs.

In the Nick of Time: Rhode Island’s Medicaid Waiver Shows How States Can Save Their Budgets from Obamacare’s Assault
The Pacific Research Institute outlines the benefits Rhode Island has enjoyed through its Medicaid reform.

Research & Commentary: States Should Avoid Medicaid Expansion
Kendall Antekeier of The Heartland Institute explains the Supreme Court ruling on Medicaid expansion under Obamacare and urges states to avoid expansion. “States should think twice about giving up more control of their Medicaid programs only to further expand a system that is already fiscally unsustainable,” she writes.


Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this subject, visit Health Care News at, The Heartland Institute’s website at, and PolicyBot, Heartland’s free online research database at

If you have any questions about this issue or the Heartland Web site, contact Heartland Institute Manager of External Relations Kendall Antekeier at [email protected] or 312/377-4000