What would states do with greater flexibility through Medicaid block grants?

Both State, Feds May Seek Changes To Medicaid

By Shamane Mills
Wisconsin Public Radio, January 11, 2017

Wisconsin hopes to change Medicaid in several ways. The Walker administration would like participants to undergo drug testing, charge smokers more and put time limits on how long people could use Medicaid.

Gov. Scott Walker's entitlement reforms come as top Republicans in Washington, D.C. are pushing for states to get federal block grants they could spend as they wish on Medicaid.


Missouri lawmakers seek to convert Medicaid to block grant

By David A. Lieb, AP
St. Louis Post-Dispatch, January 11, 2017

Not waiting for President-elect Donald Trump to act first, some Missouri Republican lawmakers are pressing for a health care overhaul that could convert the state's Medicaid program into a block grant from the federal government.

Missouri Sen. David Sater said the state's more than $9 billion Medicaid program — called MO HealthNet — is beset by "runaway spending" and lacks "personal accountability and responsibility."

The Missouri legislation seeks to address that by requesting federal approval for the block grant to be adjusted for inflation, growth in the Medicaid rolls and other economic and demographic factors. It also seeks approval to potentially implement work requirements for able-bodied Medicaid enrollees and to require co-payments, premiums or health savings accounts for patients to "reward personal responsibility."



By Don McCanne, M.D.

There are two main reasons that the Republicans want to convert Medicaid to block grants for the states. Instead of paying a percentage of Medicaid costs, block grants can be set at an amount of payment that is lower and that does not increase at the same rate as health costs, thus shifting Medicaid costs from the federal government to the states. Also, the states are given much greater leeway on how the block grant funds can be spent, reducing federal regulatory oversight.

Many state governments are concerned about the reduced funding that would be available for health care for the low-income sector. Most states operate on very tight budgets and would have difficulty assuming a significantly greater proportion of the costs. Some states simply do not have an adequate tax base that would support the needs of these individuals. Federal funding is much more equitable and egalitarian.

Granting greater leeway on how the Medicaid funds would be spent is very appealing to state ideologues. There is a push today to require greater personal responsibility through policies such as drug testing, penalizing smokers, failure to meet work requirements, requiring financial responsibility through premiums, cost sharing, and required contributions to health savings accounts in this population that has no discretionary income, and perhaps ejecting individuals from the program simply because they have been on it long enough.

These politicians seem to look upon Medicaid beneficiaries as people who are less  deserving because of their welfare status that they believe is due to their own volition. They believe that simply requiring more personal responsibility is the solution, except for those more severely handicapped. Most health professionals who work with these patients know differently and understand why they qualify for Medicaid.

But think of how it would be under a single payer national health program. Everyone would receive essential health care services regardless of socioeconomic status. The politicians certainly expect to have their care when they need it. Why shouldn’t everyone have the same expectation?