Press Release

Contact: Meg Biallas
Phone: 202-657-0664
Email: megb@firstfocus.org
FOR IMMEDIATE RELEASE

Child Advocates Call on Governors to Oppose Medicaid Block Grants and Per Capita Caps

Health

FOR IMMEDIATE RELEASE: February 24, 2017

(WASHINGTON, DC) – First Focus Campaign for Children (FFCC) President Bruce Lesley warns in an open letter to all governors this week that proposed changes to Medicaid financial structures would “undoubtedly have negative consequences on the health and well-being of our nation’s children.” Both structures currently under consideration in Congress–a block grant and a per capita cap–would jeopardize children’s health coverage, says Bruce Lesley, president of FFCC.

FFCC president Bruce Lesley writes, “As we contemplate changes to our nation’s health care system, President Trump and Congress should not gamble with the health of our children. They should commit to ‘do no harm’ to state systems of care for children and not propose changes that would undermine or reverse the incredible progress that has been made – whether intended or not.”

Under a Medicaid block grant, federal funding is provided to states based on an arbitrary cap that would fail to adjust for population growth, medical inflation, economic downturn, natural disaster, or an epidemic. States would be left entirely on the hook without any federal financial support as need increases beyond the arbitrarily-imposed limit. In such a circumstance, as the letter highlights, states would have to “choose among a variety of bad options, such as cutting off coverage for children, pregnant women, people with disabilities, or low-income senior citizens; imposing enrollment freezes (which disproportionately harm babies); putting those in need on waiting lists; withholding certain medical benefits; slashing payments to providers; raising taxes; or most likely, all of the above.”

In addition to the problems inherent with the federal government setting an arbitrary cap on state funding, FFCC’s letter to the governors also underscores the fact that Medicaid block grant and per capita cap proposals have all been accompanied by hundreds of billions of dollars in programs cuts. These cuts would harm both state budgets and the low-income children, pregnant women, people with disabilities, and senior citizens that rely on Medicaid coverage. Moreover, FFCC points to an analysis by the Center on Budget and Policy Priorities in which they show how block grants to states have historically resulted in declining funding over time.

In the letter, FCC draws a connection between Puerto Rico’s Medicaid block grant and its budget shortfalls which have contributed to their debt crisis. FFCC warns that converting Medicaid to a block grant or per capita cap would be a similar “disaster” for states.

With particular respect to the needs of children, particularly those with special health care needs, FFCC points out that kids would be most likely to bear the brunt of the cuts accompanying Medicaid funding caps. The House of Representatives’ proposed outline released last week reads, “States would have flexibility in how Medicaid funds are spent, but would be required to provide required services to the most vulnerable elderly and disabled individuals who are mandatory populations under current law.” The summary leaves out any similarly expressed protections for children and pregnant women, who account for nearly 50 percent of all Medicaid enrollees and appear to be the group most exposed to cuts.

In addition to the harm that children would be exposed to from billions of dollars in cuts, FFCC also notes that any additional spending from states to make up for potential shortfalls would compete with other programs of importance to children in state budget, including education, early childhood, child welfare, public health, and social services programs.

In closing, FFCC calls on the nation’s governors to adopt a “do no harm” standard and protect the enormous gains that have been made in children’s health coverage over the past 20 years – a drop in the uninsured rate from nearly 15 percent to less than five percent. As the letter reads, “Today, over 95 percent of our nation’s children have health insurance coverage. Now is not the time to retreat from two decades of progress and undermine the health and well-being of our nation’s children.”

The letter continues, “Consequently, we urge you to reject proposals from Congress that would impose either Medicaid per capita caps or block grants upon the states […] We also urge you to push for the swift enactment of a long-term extension of the Children’s Health Insurance Program. CHIP works exceedingly well, and, over the years, it has proven to be an enormously popular and bipartisan program for children. To ensure that children are not left worse off, action on CHIP is needed as soon as possible.”

Click here for a copy of the letter.

###

The First Focus Campaign for Children is a 501(c)(4) nonprofit organization affiliated with First Focus, a bipartisan children’s advocacy organization. The Campaign for Children advocates directly for legislative change in Congress to ensure children and families are a priority in federal policy and budget decisions.