Here’s a brilliant idea from our friend, John Goodman, who writes to us: “If you do this the right way, it will (1) save a ton of money, (2) make it easier for enrollees to get health care.”

It would also save people on Medicaid from losing a whole day of working instead of waiting in an emergency room for routine care, and provide higher quality care at the same time.

Goodman explains:

Private companies managing Medicaid (or the state itself) should be able to make deposits to Health Savings Accounts (HSAs) that would cover, say, all primary care. Enrollees would be restricted to using the money for health care during an insurance year. With these funds, they would be able to pay market prices (instead of Medicaid fees) at doctor’s offices, walk-in clinics and urgent care centers – allowing them to buy medical care the way they buy food with food stamps. This would allow low-income families to have the same health care opportunities that middle-income families have.

At the end of the insurance period, they could withdraw any unspent funds for any purpose… People wouldn’t spend a dollar on health care unless they got a dollar’s worth of value.

An early study by the RAND Corporation suggests that these accounts could reduce Medicaid spending by 30 percent.. almost $1 trillion over ten years. This saving would be shared by the beneficiaries and the taxpayers who fund Medicaid.