The Trump administration announced Thursday morning that it would take the largest step to overhaul Medicaid yet, providing an alternative to red states that want to limit spending on the public insurance option and take greater control of the health program.
Named the “Healthy Adult Opportunity,” Centers for Medicare and Medicaid Services Administrator Seema Verma said the new guidance would provide states the option to receive their federal Medicaid funding as a block grant, or a lump sum, to provide coverage to nondisabled adults, while providing states greater autonomy to manage their programs.
Under the new option, states can choose to cap the cash they receive from the federal government to a lump sum based on enrollment or a number negotiated with the CMS. This would likely be attractive to red states that want to limit spending, maintain greater flexibility, limit the size of the overall program and gain the opportunity to share in the ultimate cost-savings with the federal government.
Critics maintain that it could lead to limited benefits and decreased enrollment numbers for a program that provides health care coverage to 70 million Americans, despite Verma’s claims that expansion states would have to continue to provide the same coverage and fulfill a minimum requirement for benefits. Detractors further noted that the guidance allowed states to shrink provider payments without permission, limit access to prescription drugs, impose premiums on beneficiaries and impose a number of roadblocks to eligibility.