One of the problems with Medicaid is that it does not appear to improve recipients’ health (although the evidence can be described as mixed). The best evidence on Medicaid comes from Oregon, which ran a lottery to allow eligible people to enroll. This approximates a randomized clinical trial, the gold standard of clinical research and hard to achieve when examining the real world. Plenty of research indicates that the Oregon Medicaid did not improve health outcomes very much.
The original researchers continue to publish results, and have written a paper that might offer the best explanation why Medicaid does so little. Only 20 to 40 cents of Medicaid spending actually goes towards patients’ welfare: