States offer Medicaid (with no fiscal discipline), expand it to the middle class, low-ball health care providers, which all leads to ... higher costs for everyone else, dropped coverage, calls for expanding Medicaid, and .... Repeat.

The Athens Banner-Herald (registration required) tells how this cost-shifting is proceeding in Georgia:

Hospitals get an average of less than 86 cents from the state for every dollar they spend treating Medicaid patients. Put another way, hospitals essentially take a loss of 15 percent every time they treat a Medicaid patient.

And it has prompted hospitals to begin trying to make up their losses on Medicaid and uninsured patients by charging other customers more, a process known as cost shifting. ...

There are no firm numbers on how much cost shifting hospitals do every year, but those involved say it is substantial and is beginning to spark a wider backlash from private insurance companies and businesses offering health care for employees and their families. ...

As hospitals shift costs to private insurers, premiums must rise to make up for it. Businesses then either drop health insurance, forcing their employees to find coverage on their own, or raise the share of the cost employees have to pick up.

Some of those employees decide they can no longer afford the coverage. Along with those whose employers have stopped providing insurance, they enter the ranks of the uninsured, meaning they often can't pay the bills after a major medical crisis, or join Medicaid.

One bad policy breeds another.