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Donald Trump Is Proposing Block Grants To Replace Medicaid

By January 23, 2017 News No Comments

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Korin Miller | SELF Magazine

Seven things you should know.
Independent Still Pool / Getty Images

Donald Trump is planning on using a system known as block grants to provide health care to low-income people, along with other vulnerable populations, according to new reports. President Trump repeatedly said on the campaign trail that he would repeal the Affordable Care Act, and now one of his top advisors is revealing details about what the replacement might look like. On Sunday, counselor to the president Kellyanne Conway said on NBC’s Sunday Today that Trump is proposing the use of block grants, a fixed amount of federal money provided to each state, to replace Medicaid, the federal- and state-funded health insurance program for low-income people.

With a block grant, the federal government would assign a pre-determined “block” of money to each state with the intention of helping those who were previously assisted by Medicaid, which currently covers over 70 million Americans in need of health care, with more than 10 million of those having gained access under the Affordable Care Act. Conway said that converting Medicaid to block grants will ensure that “those who are closest to the people in need will be administering” the program. But health care experts have concerns—here’s what you need to know.

1. Block grants would be an extreme change from Medicaid, which has been in existence since 1965.

Currently, Medicaid is an open-ended entitlement, meaning that states receive more federal funding if health care demands go up due to factors like a recession, the flu, or expensive new medications, the New York Times reports. However, if the federal government replaces Medicaid with block grants, that means that if something bad happens, the states won’t get any more money to help deal with it, Sarah O’Leary, founder of Exhale Healthcare Advocates, a national consumer health care advocacy group, tells SELF. So if we deal with another recession, for example, Medicaid would allow states to get enough money to cover all the people who no longer have jobs and need Medicaid coverage. But that wouldn’t happen with block grants, and as a result of the shortage of funding, people in need of health care could suffer, O’Leary says.

2. This change would shift the responsibility of handling a lack of health care funding to the states.

Block grants are designed to save the federal government money, and Leonard Fleck, Ph.D., a professor of philosophy and medical ethics at Michigan State University, tells SELF that’s concerning. “If you give the state a block grant, and it’s reduced in size from what it previously received, the state is responsible for deciding how it’s going to allocate that smaller quality of funding,” he says. If a block grant that a state receives is smaller than state officials think they need, states will need to figure out how to make up the difference—typically through raising taxes, Fleck says.

3. As a result, people could lose coverage.

“Block grants can and will run out of money when people need them the most, which will put lives in danger,” O’Leary says. Health care expert Caitlin Donovan, spokeswoman for the National Patient Advocate Foundation, agrees, telling SELF that if a state runs out of money while adhering to a block grant system, “state administers would then have to make a lot of decisions that could break down to either eliminating enrollees, eliminating benefits—or both.”

Medicaid is actually difficult to qualify for, and in some states, a person has to be low-income and also needs to have a disability, have children, or have other mitigating factors to qualify, Donovan says. “Medicaid already doesn’t cover as many people who need it,” she says. “If these changes go through, there is a real possibility that even more people will be left without coverage.”

4. This could impact a large swath of people—including families with disabilities, as well as the elderly.

People typically think of impoverished women and children as the main beneficiaries of government-subsidized health insurance, but Fleck says that Medicaid helps many others. He lists families and people with disabilities among them, as well as the elderly. “The largest amount of people who benefit from Medicaid are impoverished elderly individuals who receive longterm care,” he says.

5. Block grants could save the federal government money, but any savings would come at the expense of poor people, people with disabilities, and the elderly losing access to healthcare.

“Rather than [calling] it ‘block grants,’ maybe ‘cut ‘em off at the knees’ is more appropriate,” O’Leary says. “Block grants are roadblocks to access.” Block grants are designed to promote politics, cost-cutting, and budget reallocation, and aren’t focused on the well-being of sick and poor Americans who benefit from government-assisted healthcare, O’Leary says.

“We worry about any plan that could take away benefits from the patients who need them,” Donovan says. “We haven’t seen any details yet, but since the devil is in the details, that may not be very comforting.”

In addition, block grants without conditions (such as who is covered or what is covered) will increase the financial disparities among states, Kristie J. Loescher, M.P.H., director for Education and Community Engagement, Health Care Initiative, at the University of Texas at Austin, tells SELF. “Leaving all discretion up to the states will also increase change—when a new political party takes over, they will change the rules, creating confusion and health care insecurity for the low-income population in that state,” she says.

6. This isn’t a new idea.

Paul Ryan, the current Speaker of the House of Representatives, proposed block grants back in 2014, according to the Center for Budget and Policy Priorities. That plan would cut more than 26 percent of federal funding to Medicaid, which the center says would “substantially—and adversely—affect millions of low-income Americans’ ability to secure health coverage and access needed health care services.”

7. As of now, there’s no clearly outlined benefit for patients.

O’Leary says there’s a “glaring omission” in the conversation about block grants: How the recipients would benefit from the change. “It’s not about making these 70 million Americans’ lives better—it’s about giving less to the poor, disabled, and elderly who have no voice (and often no vote), so that politicians can spend the money on things they find more appealing,” she says.

Experts urge people to speak out against the proposal. “Our organization directly works with many people who need Medicaid—we know how important it is,” Donovan says. “We would urge everyone, not just those covered by Medicaid, to call their elected officials and express any concerns they may have about lives of patients that may be in danger if Medicaid coverage is threatened.”

O’Leary agrees. “Medicaid works, as it has since 1965,” she says. “Now is not the time to throw out the baby with the bath water.”

This content appears as it was originally published on the SELF Magazine website.

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