Why does Medicaid and other low income benefits have a hard cut off on a specific income rather than role off proportionally as an individual makes more in the US?

Question

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In: Economics

Answer 1

Because means testing is the only way that any kind of social welfare programs get political support. Even though the administrative costs of doing so often significantly outweigh the money saved by doing it like what you’re proposing. The other issue is that this was a program passed in the 1960s that has a lot of rickety and frankly outdated formulas for what’s considered “poverty”.