WASHINGTON, D.C. — A state-by-state analysis by Kaiser Family Foundation shows the House budget plan for Medicaid would reduce the federal deficit, but could also reduce Medicaid enrollment by tens of millions of people. The commission says it could also cut funding for hospitals and other Medicaid services.
According to the analyisis, converting Medicaid into a block grant and repealing the health reform law as adopted by the House last month would trigger a shift with big implications for states, hospitals and tens of millions of low-income Americans who likely would become uninsured.
Under the House Budget Plan, advanced by House Budget Committee Chairman Paul Ryan, projected federal spending on Medicaid for the period 2012 to 2021 would fall by $1.4 trillion, a 34 percent decline. In 2021, the end of the typical 10-year budget window used by Congress, states would receive $243 billion less annually in federal Medicaid funding than they would under current law, a 44 percent reduction. The plan would curb Medicaid spending and enrollment by eliminating the Patient Protection and Affordable Care Act (ACA) and its major Medicaid expansion scheduled to begin in 2014. It would also cap the amount of federal funding for Medicaid through a block grant.
According to the new analysis of the plan conducted by researchers at the Urban Institute working with analysts at the Foundation, total federal Medicaid spending reductions over the next decade relative to current law would range from a 26 percent drop in Washington, Vermont and Minnesota, to 41 percent declines Oregon, Georgia and Colorado and a 44 percent decrease in Florida. The analysis also finds that hospitals could see their Medicaid payments fall by as much as 38 percent, relative to current projections, in 2021.
“Under the House Budget Plan, the Medicaid block grant would reduce and cap federal Medicaid spending, substantially reducing states’ ability to provide coverage to low-income Americans,” said Diane Rowland, Executive Vice President of the Foundation and Executive Director of the Kaiser Commission on Medicaid and the Uninsured. “The repeal of the ACA combined with the adoption of the Medicaid block grant would add millions more to the number of uninsured Americans and compromise Medicaid’s role as the health safety net in the next recession.”
The full analysis, including an in-depth discussion of methodology and state-by-state data tables, is available online at http://www.kff.org/medicaid/8185.cfm.