Medicaid At 50: Remarkable Growth Fueled By Unexpected Politics

Medicaid has grown exponentially since the mid-1980s, during both conservative Republican and liberal Democratic administrations. How has this happened? The answer is rooted in three political variables: interest groups, political culture, and American federalism. First, interest-group support (from hospitals, nursing homes, and insurers) is more influential than the fragmented group opposition (from underpaid office-based physicians). Second, Medicaid provides a partial counterweight to conservative charges of a federal health care takeover because of the states' roles in administering the program. Third, Medicaid's intergovernmental fiscal partnership creates financial incentives for state and federal officials to expand enrollment-expansions that these policy makers often favor, given the program's increasingly important role in the nation's health care system. This institutional dynamic is here called catalytic federalism.