Why? Well study after study has shown that Medicaid provided much more coverage per dollar spent than does private insurance. And this makes intuitive sense, as private insurers are for profit.
In terms of the cost differences, this paper, published in Health Affairs, found that
if an average low-income Medicaid adult were instead covered by private health insurance for a full year, total spending would climb from $5,671 per person per year to $7,126, an increase of 26 percent. The level of out-of-pocket payments would rise from $197 to $1,293, an increase of 556 percent.So, compared to using Medicaid, Shiozawa’s plan would cost 26% more to insure the same amount of people. Now why would that be desirable in any universe?
And how does Medicaid provide more cost efficient service? From the CBPP:
First, the average cost that insurers (i.e. the public program or private insurance plan) pay per beneficiary is lower under public programs than under private insurance, probably because these programs reimburse health care providers at lower rates and have lower administrative costs. Second, the average out-of-pocket costs that individuals incur are substantially lower under public programs than private insurance because Medicaid and SCHIP limit cost-sharing for low-income beneficiaries.Indeed, the Kaiser Family Foundation states that Medicaid administrative costs are half of those of private insurers; in addition, Medicaid doesn’t have to make a profit, and it also reimburses doctors at a lower rate than does private insurance*.
Why does the Utah legislature want to reinvent the wheel in order to use our tax dollars less efficiently?
*Perhaps this is the reason Dr Shiozawa opposes Medicaid expansion? I'll email him to check.
Postscript: And no, Medicaid costs aren't out of control, and can't be used as an excuse for not expanding the program in Utah.