Tuesday, August 27, 2019

Some States Show Interest in Medicaid Funding Caps


It's now been more than seven months since news emerged that the Trump administration wants to use waivers to bring block grants to Medicaid. The administration has since moved closer to doing so, as a document titled "State Medicaid Director Letter: Medicaid Value and Accountability Demonstration Opportunity" has been on the Office of Management and Budget’s website since June 6.
What's more, some states have made moves that suggest they would try to cap their Medicaid funding if given the green light by CMS. Tennessee is drawing up a waiver request that would move TennCare from an open-ended entitlement program to one with fixed federal payments, in exchange for more flexibility. And Utah recently submitted a waiver proposal that would apply per capita caps to its Medicaid program, giving the state a fixed amount of federal money per enrollee.
"We would expect to see that if they do approve some kind of block grant waiver somewhere, the administration is likely to give that state possibly some pretty favorable financial terms [that] would not be in place for all states," says Joan Alker, executive director of the Georgetown University Center for Children and Families.
That, she says, would help the administration make the case to Congress to apply Medicaid funding caps to the whole country. "But it would be a sham experiment because congressional proposals are all about significant cuts," Alker adds.
According to Alex Shekhdar, founder of Sycamore Creek Healthcare Advisors, "there would absolutely be legal challenges" if Medicaid block grant or per capita cap waivers move from concept to reality. Looming over both funding-cap waivers and Medicaid work requirements waivers, he says, "is a conversation about what kind of administrative authority the HHS secretary has."

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