Overhaul of Medicaid expansion could cost states $32 bln -report

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By Hilary Russ | NEW YORK

NEW YORK Proposals in Congress that would
effectively end Medicaid expansion in 31 U.S. states would cost
those states at least $32 billion altogether in 2019, according
to a report released on Friday.

“Few, if any, states could absorb such new costs,” the
Center on Budget and Policy Priorities, a Washington-based,
left-leaning think tank, said in its report.

Republican President Donald Trump has pushed to fulfill a
campaign promise to replace Obamacare, his Democratic
predecessor’s signature healthcare plan, with the help of a
Republican-controlled Congress.

More details of potential replacements by U.S. House
Republicans for former President Barack Obama’s Affordable Care
Act emerged on Friday, though they have yet to agree on a single
detailed policy proposal to repeal and replace the healthcare
law.

One scenario to phase out enhanced federal funding would
convert the current system, in which states share the cost of
Medicaid enrollees with the federal government, into fixed
payments, or block grants, sent to the states.

But that would dramatically affect the 31 states and the
District of Columbia that chose to expand Medicaid, the
government health insurance program for low-income Americans,
and collect extra dollars that came with expansion.

Those states would have to find the extra $32 billion
themselves to maintain their expansions, the center said in its
report.

The block grant conversion would “shrink federal Medicaid
funding over time, result in even deeper funding cuts when needs
increase, and ultimately place coverage for tens of millions
more Americans at risk,” the center said in its report.

The reduced federal funding would cause the automatic end of
the expansion in seven states. Other expansion states would “almost certainly drop or substantially scale back their
expansions,” the report said.

Medicaid sits at the heart of the federal-state fiscal
relationship. Over $330 billion in federal Medicaid dollars
flowed to states in fiscal year 2016, accounting for more than
half of all federal grants sent to state and local governments
and the largest individual program, according to Standard &
Poor’s.



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