Medicaid for All
Democrats have been reaching for the wrong public program. The better model for universal health care has been quietly under construction in all fifty states.
By Seth Bernstein, Ph.D.
For most of the last decade, the progressive answer to American health care has come in three words: Medicare for All. I understand the appeal. Medicare is popular, familiar, and easy to explain. Nearly everyone over 65 has it, and almost nobody wants to give it up.
I have spent my career inside the machinery of American health care. I have delivered care as a provider. I have worked as an executive in managed care. Much of my work has been in behavioral health, where the gaps in our system are widest and the human cost of those gaps is easiest to see. From that vantage point I have reached a conclusion that may surprise some of my fellow Democrats. If we are going to build one public health system for everyone, Medicare is the wrong foundation. Medicaid is the right one.
Medicare for All would take the least organized part of American health care and make it universal. Medicaid for All would take the part that has spent thirty years learning how to organize care, reward prevention, and pay for health, and open it to everyone.
Traditional Medicare Is a Payment Engine
Traditional Medicare is, at its core, a claims-processing operation of enormous scale and admirable administrative efficiency. A provider delivers a service, submits a claim, and gets paid from a national fee schedule. The program knows very little about whether that service was the right one, whether it duplicated something another provider already did, or whether anyone was responsible for the patient’s overall health.
The result is fragmentation that researchers have documented for years. A landmark study in the New England Journal of Medicine found that the typical Medicare beneficiary saw two primary care physicians and five specialists working in four different practices in a single year, and about a third of visits were with the physician assigned as their primary care physician [1]. Related research found that, in 2005, a typical primary care physician had to coordinate with 229 other physicians in 117 other practices for their fee-for-service Medicare patients [2]. Nobody can coordinate care across a network that large without a structure built to do it. Fee-for-service Medicare provides no such structure.
Medicare’s own beneficiaries have noticed. More than half of eligible beneficiaries, 55 percent in 2026, now choose private Medicare Advantage plans over the traditional program [3]. Medicare has also tried to add coordination through voluntary accountable care organizations, which now serve about 12.6 million people in the Medicare Shared Savings Program [4]. Those are real efforts, and some of them work. They are also add-ons, bolted onto a fee-for-service chassis that still defines how most providers get paid.
Behavioral health reveals the limits most clearly. Medicare still caps care in freestanding psychiatric hospitals at 190 days over a person’s entire lifetime, a lifetime cap with no parallel for general hospital care [5]. Licensed professional counselors and marriage and family therapists, who deliver a large share of the country’s psychotherapy, could not bill Medicare independently until 2024 [5]. In 2024, Medicare also began paying for certain care-management and navigation services that may involve peer support specialists when they meet program requirements; this is not a general standalone peer-support benefit [6].
Consider collaborative care, one of the best-validated models in behavioral health. In the IMPACT trial, published in JAMA in 2002, 45 percent of older adults with depression who received collaborative care had their symptoms cut at least in half after a year, compared with 19 percent in usual care [7]. Follow-up research estimated lower average total health care costs over four years, although the difference was not statistically conclusive [8]. Every person in that trial was 60 or older, the very population Medicare exists to serve. Medicare did not begin paying for the model under dedicated collaborative-care billing codes until 2017, fifteen years later [9].
Medicaid Built the Machinery
Medicaid’s story over the same period looks very different. Because states share the cost and run their own programs, they have had both the incentive and the authority to experiment, and most of them have used it. In 2024, about 78 percent of Medicaid beneficiaries in states that use comprehensive managed care organizations were enrolled in one [10], and capitated payments to comprehensive managed care plans accounted for about 50 percent of all Medicaid spending in federal fiscal year 2024 [11]. That matters. A plan paid a fixed amount per person has a reason to keep that person healthy. A fee schedule rewards volume.
Some states went much further.
Oregon. In 2012 Oregon moved most of its Medicaid enrollees into regional coordinated care organizations, or CCOs, which manage physical, behavioral, and dental care under a single global budget with a capped growth rate [12]. Researchers at Oregon Health & Science University compared Oregon with neighboring Washington and found that the transition was associated with a 7 percent relative reduction in spending across the services they studied, driven mostly by fewer inpatient stays, along with fewer avoidable emergency department visits [13, 14]. According to the state, the model stayed within its 3.4 percent annual growth cap during the first five-year waiver period while adding hundreds of thousands of enrollees, producing more than $1 billion in cumulative savings [12]. The same independent evaluation flagged a drop in primary care visits as a concern [13], which is exactly the kind of feedback a learning system is supposed to generate.
Massachusetts. MassHealth launched a statewide accountable care program in 2018, and by 2023 about 1.3 million members were enrolled in its ACOs [15]. In 2023, primary-care use among ACO members increased while physical-health inpatient use and emergency department use declined; utilization trends varied by service, including increases in behavioral-health inpatient care [15].
Minnesota. Minnesota’s Integrated Health Partnerships, the state’s Medicaid ACO model, saved nearly $156 million in their first three years while reducing inpatient admissions by 14 percent and emergency department visits by 7 percent [16].
None of these models is perfect. Each one, though, reflects a state deciding what good care should look like, building a delivery structure to produce it, measuring the results, and adjusting course. That discipline is what a health system looks like. Fee-for-service Medicare has never been asked to develop it.
Where Medicaid Leads: Behavioral Health
Medicaid is the single largest payer for mental health and substance use services in the United States [17]. It covers nearly one-third of all adults with mental illness and nearly half of adults with opioid use disorder [18]. That responsibility has pushed states to build the services that actually keep people with serious conditions out of emergency rooms, hospitals, and jails.
Peer support is one example. In a 2023 national survey, 41 of the 44 responding states reported that their Medicaid programs reimburse peer support services [19]. Medicare is just getting started.
Certified Community Behavioral Health Clinics are another example. They must provide or coordinate nine required services, including crisis care, and accept people regardless of ability to pay [18, 38]. In the Medicaid demonstration, participating states reimburse clinics through a prospective payment system designed to cover the expected cost of required services [39]. In a federally funded evaluation, Medicaid beneficiaries served by CCBHCs in Pennsylvania and Oklahoma had statistically significant reductions in behavioral-health emergency visits compared with similar people treated at other clinics. The main analysis did not find a statistically significant hospitalization reduction; reductions appeared in sensitivity analyses [20].
Missouri built health homes inside its community mental health centers, adding primary care nurse liaisons to coordinate physical health care for people with serious mental illness. In state-reported results after the first year, the program reduced costs by $98 per member per month and reported $31 million in Medicaid savings, while hospital admissions fell 12.8 percent and emergency room use fell 8.2 percent [21]. A later federal report to Congress summarized Missouri’s early findings and noted evidence that savings increased with additional months of enrollment, while cautioning that early estimates have limitations [22].
Arizona health officials have reported that people with serious mental illness have life expectancy roughly 25 to 30 years shorter than the general population, with much premature mortality linked to preventable physical conditions [23]. Arizona integrated physical and behavioral health care in phases, beginning with targeted groups and expanding through AHCCCS contracts; the shift was not a single 2016 transfer of a behavioral health division into Medicaid [24].
This is the heart of my argument. People with serious mental illness die young largely because their physical care and their behavioral care happen in separate worlds. Medicaid has spent two decades building bridges between those worlds. Medicare for All would ask us to abandon those bridges and start over with a program that began paying counselors two years ago.
Paying for Health Instead of Sickness
The most radical thing Medicaid has done is to start paying for the conditions that make people sick in the first place.
North Carolina’s Healthy Opportunities Pilots used Medicaid dollars to pay for food, housing supports, transportation, and help for people facing interpersonal violence and toxic stress. A 2026 evaluation by the University of North Carolina’s Sheps Center, covering more than 31,000 participants, found the program reduced total health care costs by an average of $164 per member per month, including the cost of services and administration [25, 26]. Participants had fewer emergency visits and hospital stays, used more primary care, and reported fewer food, housing, and transportation needs [26].
Medicaid also pays for most of the long-term care in this country. It financed more than half of the $415 billion the nation spent on long-term services and supports in 2022 [27] and nearly two-thirds of all home care spending in 2023 [28]. Four in ten adults wrongly believe Medicare is the main source of coverage for that care [28]. Medicare covers limited skilled nursing and home-health care under specific conditions, but generally does not cover ongoing custodial long-term care [29]. Any serious universal program has to cover long-term care, and Medicaid already knows how.
Medicaid has done all of this while holding costs down. Between 2006 and 2017, Medicaid spending per enrollee grew 1.6 percent per year, compared with 2.4 percent for Medicare and 4.4 percent for private insurance [30].
The Honest Objections
I spent enough years in managed care to know its failure modes, and anyone proposing Medicaid for All should name them plainly.
The first is that managed care can manage people out of care. A 2023 report from the HHS Office of Inspector General, using 2019 data, found that Medicaid managed care plans denied 12.5 percent of prior authorization requests, more than double the 5.7 percent rate for Medicare Advantage, and that 12 of the 115 plans reviewed denied more than a quarter of requests [31]. In Medicare Advantage, a denial that the plan upholds on appeal goes automatically to an independent reviewer. Medicaid has no federal requirement for automatic independent review, although some states provide external review [32].
The second is money. Medicaid often pays providers less than Medicare or commercial insurance, though rates vary by state and service. Low reimbursement can constrain provider participation, including among behavioral health clinicians [33].
The third is fragility. Because every state program depends on its own legislature, proven ideas can vanish. North Carolina’s legislature did not fund the Healthy Opportunities Pilots after July 1, 2025, and the program suspended operations [34]. In July 2026, the state approved $9 million in state funding for a limited restart, with implementation details still being determined [34]. In March 2025, federal regulators rescinded guidance that 18 states had used to cover health-related social needs [35]. And the 2025 budget reconciliation law was projected by the Congressional Budget Office to leave about 10 million more people uninsured by 2034 [36].
These problems share a root. Medicaid’s innovations sit on a program that is means-tested, underfunded, and politically exposed because many voters see it as serving someone else. Researchers at Duke-Margolis identified the structural trap: savings from prevention take years to materialize, while state budgets run on short cycles [37]. Make Medicaid universal and every one of those conditions changes. A program that covers everyone has everyone as its constituency, a national financing base that can wait for prevention to pay off, and a federal floor that no single legislature can pull out from under a successful program.
What Medicaid for All Should Look Like
Medicaid for All would keep what works in today’s programs and fix what the objections above expose. At a minimum it should include:
- Universal eligibility with a federal floor. Everyone is covered, and national standards guarantee a comprehensive benefit that includes behavioral health, long-term services and supports, and dental care.
- Regional accountable organizations with global budgets. Building on Oregon, Massachusetts, and Minnesota, local entities take responsibility for the total health of a defined population under a risk-adjusted budget with a sustainable growth rate.
- Integrated behavioral health by design. Physical, mental health, and substance use care share one budget and one care plan, with community behavioral health clinics, collaborative care, and peer support as standard benefits.
- Payment rates that make access real. Primary care and behavioral health should be paid at Medicare levels or better, so that coverage translates into an appointment.
- Social needs as an ordinary benefit. Food, housing, and transportation supports become covered services wherever the evidence shows they improve health and lower total cost.
- Consumer protections with teeth. Public reporting of denial rates by plan, automatic independent external review, and enforceable medical loss ratio requirements.
- A permanent evaluation infrastructure. Every region’s innovations get measured, and the ones that work spread nationally instead of dying in a state budget fight.
The Choice in Front of Us
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Medicare for All answers the question of how to pay everyone’s bills. Medicaid for All answers a harder and more important question: how do we keep people healthy, and how do we pay for that?
The answer to that second question already exists, scattered across fifty state programs, in coordinated care organizations, health homes, community behavioral health clinics, and food and housing pilots. It has been tested, evaluated, revised, and in many places proven. It has also been starved, stigmatized, and cut.
Democrats have spent years defending Medicaid from attack. It is time to argue that it should be the model for everyone. We have already built the system. We just never let everyone in.
References
[1] Pham HH, Schrag D, O’Malley AS, Wu B, Bach PB. Care Patterns in Medicare and Their Implications for Pay for Performance. New England Journal of Medicine. 2007;356(11):1130–1139. https://www.nejm.org/doi/full/10.1056/NEJMsa063979
[2] Pham HH, O’Malley AS, Bach PB, Saiontz-Martinez C, Schrag D. Primary Care Physicians’ Links to Other Physicians through Medicare Patients: The Scope of Care Coordination. Annals of Internal Medicine. 2009;150(4):236–242. https://pmc.ncbi.nlm.nih.gov/articles/PMC3718023/
[3] KFF. Medicare Advantage in 2026: Enrollment Update and Key Trends. July 2026. https://www.kff.org/medicare/medicare-advantage-in-2026-enrollment-update-and-key-trends/
[4] Centers for Medicare & Medicaid Services. Shared Savings Program Fast Facts, as of January 1, 2026. https://www.cms.gov/files/document/2026-shared-savings-program-fast-facts.pdf
[5] Commonwealth Fund. Medicare Mental Health Coverage: What’s Included, What Changed, and What Gaps Remain. March 2023. https://www.commonwealthfund.org/publications/explainer/2023/mar/medicare-mental-health-coverage-included-changed-gaps-remain
[6] Counts N. Medicare Reforms Support Behavioral Health by Expanding Access to Peer Support Specialists and Community Health Workers. Commonwealth Fund, To the Point (blog). February 2024. https://www.commonwealthfund.org/blog/2024/medicare-reforms-support-behavioral-health-expanding-access-peer-support-specialists-and
[7] Unützer J, Katon W, Callahan CM, et al. Collaborative Care Management of Late-Life Depression in the Primary Care Setting: A Randomized Controlled Trial. JAMA. 2002;288(22):2836–2845. https://jamanetwork.com/journals/jama/fullarticle/195599
[8] Unützer J, Katon WJ, Fan MY, et al. Long-term Cost Effects of Collaborative Care for Late-life Depression. American Journal of Managed Care. 2008;14(2):95–100. https://pubmed.ncbi.nlm.nih.gov/18269305/
[9] American Psychiatric Association. Frequently Asked Questions: Billing Psychiatric Collaborative Care Management (CoCM) Codes. https://www.psychiatry.org/File%20Library/Psychiatrists/Practice/Professional-Topics/Integrated-Care/FAQs-Billing-Psychiatric-Collaborative-Care-Management-Codes.pdf
[10] Becker’s Payer Issues. Share of Medicaid Beneficiaries in Managed Care, Ranked by State (KFF 2024 data). March 2026. https://www.beckerspayer.com/rankings-ratings/share-of-medicaid-beneficiaries-in-managed-care-ranked-by-state/
[11] KFF. Medicaid Financing: The Basics. Medicaid. https://www.kff.org/medicaid/medicaid-financing-the-basics/
[12] Kitzhaber J. Oregon Coordinated Care Organizations (summarizing Oregon Health Authority data). April 2021. https://blog.johnkitzhaber.com/oregon-coordinated-care-organizations/
[13] McConnell KJ, et al. Oregon’s Medicaid Reform and Transition to Global Budgets Were Associated with Reductions in Expenditures. Health Affairs. 2017;36(3). https://www.healthaffairs.org/doi/10.1377/hlthaff.2016.1298
[14] Tracy K. Oregon’s Coordinated Care Organizations Show Promising Results. Center for Health Systems Effectiveness, Oregon Health & Science University. 2018. https://www.ohsu.edu/sites/default/files/2019-10/Brief_CCOs_FINAL.pdf
[15] Massachusetts Legislature. MassHealth Delivery System Restructuring 2023 Report. https://malegislature.gov/Reports/55098/MassHealth%20Delivery%20System%20Restructuring%202023%20Report1.pdf
[16] Center for Health Care Strategies. Medicaid Accountable Care Organizations Version 2.0 Underway in Minnesota and Colorado. https://www.chcs.org/medicaid-accountable-care-organizations-version-2-0-underway-minnesota-colorado/
[17] Medicaid and CHIP Payment and Access Commission (MACPAC). Behavioral Health. https://www.macpac.gov/topic/behavioral-health/
[18] KFF. Medicaid Mental Health and Substance Use: Expansion Trends and the Fiscal Pressure Ahead. May 2026. https://www.kff.org/medicaid/medicaid-mental-health-and-substance-use-expansion-trends-and-the-fiscal-pressure-ahead/
[19] NASMHPD Research Institute (NRI). Use of Peer Specialists in State Behavioral Health Service Settings, 2023. https://nri-inc.org/media/ve5b3e5e/use-of-peer-specialists-in-state-bh-service-settings-2023.pdf
[20] Brown JD, Breslau J, Wishon A, et al. Impacts of the Certified Community Behavioral Health Clinic Demonstration on Emergency Department Visits and Hospitalizations. Psychiatric Services. 2023. https://psychiatryonline.org/doi/10.1176/appi.ps.20220410
[21] Gold Award: A Health Care Home for the “Whole Person” in Missouri’s Community Mental Health Centers. Psychiatric Services. 2015;66(10). https://psychiatryonline.org/doi/10.1176/appi.ps.661013
[22] Centers for Medicare & Medicaid Services. Report to Congress on the Medicaid Health Home State Plan Option. https://www.medicaid.gov/state-resource-center/medicaid-state-technical-assistance/health-home-information-resource-center/downloads/medicaidhomehealthstateplanoptionrtc.pdf
[23] Arizona Health Care Cost Containment System. Independent Evaluation of Arizona’s Medicaid Integration Efforts: Programs for Children’s Rehabilitative Services and Persons Determined to Have a Serious Mental Illness. 2018. https://www.azahcccs.gov/PlansProviders/Downloads/RFPInfo/YH20/CRS_SMI_IndependentEvaluationReport_11_27_18.pdf
[24] Arizona Health Care Cost Containment System (AHCCCS). Integrated System of Care. https://azahcccs.gov/Resources/OversightOfHealthPlans/SystemOfCare.html
[25] North Carolina Department of Health and Human Services. Healthy Opportunities Pilots Lead to Healthier Outcomes and Reduce NC Medicaid Costs (press release). June 2, 2026. https://www.ncdhhs.gov/news/press-releases/2026/06/02/healthy-opportunities-pilots-lead-healthier-outcomes-and-reduce-nc-medicaid-costs
[26] North Carolina Department of Health and Human Services. Healthy Opportunities Pilots Summative Evaluation Report. March 31, 2026. https://www.ncdhhs.gov/hop-summative-evaluation-report/download?attachment=
[27] Chidambaram P, Burns A. 10 Things About Long-Term Services and Supports (LTSS). KFF. July 8, 2024. https://www.kff.org/medicaid/10-things-about-long-term-services-and-supports-ltss/
[28] KFF. Medicaid Home Care (HCBS) in 2025. January 2026. https://www.kff.org/medicaid/medicaid-home-care-hcbs-in-2025/
[29] Medicare.gov. Long-Term Care. https://www.medicare.gov/coverage/long-term-care
[30] Holahan J, McMorrow S. Slow Growth in Medicare and Medicaid Spending per Enrollee Has Implications for Policy Debates. Urban Institute / Robert Wood Johnson Foundation. February 2019. https://www.urban.org/research/publication/slow-growth-medicare-and-medicaid-spending-enrollee-has-implications-policy-debates
[31] U.S. Department of Health and Human Services, Office of Inspector General. High Rates of Prior Authorization Denials by Some Plans and Limited State Oversight Raise Concerns About Access to Care in Medicaid Managed Care. OEI-09–19–00350. July 2023. https://oig.hhs.gov/reports/all/2023/high-rates-of-prior-authorization-denials-by-some-plans-and-limited-state-oversight-raise-concerns-about-access-to-care-in-medicaid-managed-care/
[32] KFF. New OIG Report Examines Prior Authorization Denials in Medicaid MCOs. https://www.kff.org/medicaid/new-oig-report-examines-prior-authorization-denials-in-medicaid-mcos/
[33] Milbank Memorial Fund. Medicaid Cuts Will Heighten the US Mental Health and Substance Use Crisis. Milbank Quarterly Opinion. September 2025. https://www.milbank.org/quarterly/opinions/medicaid-cuts-will-heighten-the-us-mental-health-and-substance-use-crisis/
[34] North Carolina Department of Health and Human Services. Healthy Opportunities Pilots. Program status and SFY 2027 restart funding. https://www.ncdhhs.gov/about/department-initiatives/healthy-opportunities/healthy-opportunities-pilots
[35] Association of American Medical Colleges. CMS Rescinds Guidance on Addressing Health-Related Social Needs in Medicaid. March 7, 2025. https://www.aamc.org/advocacy-policy/washington-highlights/cms-rescinds-guidance-addressing-health-related-social-needs-medicaid
[36] Congressional Budget Office. Effects of Public Law 119–21 on Health Insurance Coverage. July 21, 2025. https://www.cbo.gov/publication/61570
[37] Duke-Margolis Institute for Health Policy. North Carolina’s Healthy Opportunities Pilots: Impacts and Budgetary Considerations. June 20, 2025. https://healthpolicy.duke.edu/publications/north-carolinas-healthy-opportunities-pilots-impacts-and-budgetary-considerations
[38] Substance Abuse and Mental Health Services Administration. CCBHC Certification Criteria. https://www.samhsa.gov/communities/certified-community-behavioral-health-clinics/ccbhc-certification-criteria
[39] Centers for Medicare & Medicaid Services. CCBHC Prospective Payment System and Quality Bonus Payments. https://www.medicaid.gov/medicaid/financial-management/certified-community-behavioral-health-clinic-ccbhc-demonstration/prospective-payment-system-pps-quality-bonus-payments-qbps
