This N&O article highlighting the growth of North Carolina’s Health Choice program exemplifies the built-in incentives for government to grow.
The state has earned a $21 million bonus from the federal government for enrolling more children in a public-private health insurance program and making it easier for them to stay in it.
North Carolina was one of 23 states sharing $296 million in bonuses awarded for cutting application paperwork and exceeding enrollment targets.
N.C. Health Choice, the state version of the national Children’s Health Insurance Program, enrolls about 150,000 children, according to the state Department of Health and Human Services. That’s up from about 134,000 in 2010.
In other words, the federal government paid out more than a quarter of a billion dollars that it doesn’t have to give to states to expand a government health insurance program that they can’t afford.
Rule #1 when examining public policy is the fact that incentives matter. When the federal government offers up millions to states as a “reward” to expand their programs, naturally states are going to expand their programs.
This story presents a prime case study in how government bureaucrats think up ways to expand their power over society.