Medicaid is a lifeline to more than 73 million low-income Americans, providing health insurance, assistance with Medicare premiums, long-term services and supports, and financial aid to safety net hospitals and health centers. Seniors, people with disabilities, and many from communities of color rely heavily on Medicaid benefits to survive. Medicaid is becoming particularly important as the number of people living longer with Alzheimer’s disease and related dementias grow. The majority of nursing home residents (about two-thirds) have some form of cognitive impairment. By 2050, Medicaid expenses for this population are expected to climb by almost 400 percent, reaching $172 billion in 2050.
Despite Medicaid’s importance to our nation’s most vulnerable members of society, some policymakers want to cut Medicaid funding by imposing a “per capita cap” or “block grant” system.
- Under “per capita caps,” states would receive a fixed dollar amount per beneficiary. Caps could vary for different groups of people, such as the aged, blind, people with disabilities, children, and adults.
- Under “block grants,” states would receive a lump sum from the federal government to fund their Medicaid programs.
Impact on Medicaid Program
|Per Capita Cap
Fixed dollar amount per beneficiary
Lump sum funding
Under a block grant or per capita cap system, states would have to find additional funding if federal funds did not keep up with their Medicaid population’s needs. States that expanded their Medicaid programs under the Affordable Care Act will be especially hard hit if the Medicaid expansion is eliminated as part of Obamacare repeal efforts as they will lose funding for their expansion and non-expansion populations. States could address their funding shortfalls in any number of ways, including:
- Scaling back nursing home quality, service and safety protections, endangering the lives of vulnerable seniors.
- Asking patients’ spouses, children or other family members to cover the cost of nursing home care, exhausting much or all of their savings.
- Tightening eligibility criteria to home and community-based services, resulting in more individuals moving into nursing homes.
· Limiting the number of people served.
NATIONAL COMMITTEE POSITION
The National Committee opposes per capita cap or block grant proposals because they would reduce Medicaid benefits and access, jeopardizing the quality of care provided to millions of people particularly seniors and people with disabilities. President Trump, Speaker of the House Paul Ryan and Secretary of the Department of Health and Human Services Alex Azar have all supported block grants.
Instead of cutting the program, the National Committee supports expanding Medicaid because the program has a proven record of saving lives, improving health outcomes and providing health and long-term services and supports coverage efficiently.