off the charts
POLICY INSIGHT
BEYOND THE NUMBERS
BEYOND THE NUMBERS
Latest “Evidence” That Block-Granting Medicaid Would Help States? Hardly.
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As we’ve noted, troubling proposals to convert Medicaid into a block grant are getting new attention, and a recent paper by Douglas Holtz-Eakin, president of the conservative policy group American Action Forum, cites a demonstration project that Rhode Island is operating under a federal waiver as evidence that states would fare quite well under a block grant.
Under its “global waiver,” Rhode Island accepted a cap on combined federal and state Medicaid spending from 2009-2013 in return for increased flexibility over certain Medicaid rules and the ability to qualify for new federal funds in some areas. A closer look at the global waiver shows that Rhode Island’s experience is very different from what would happen to states under a block grant, as our report shows:
Moreover, while proponents claim that Rhode Island has gleaned significant savings from its global waiver, those savings mostly reflect the state’s receipt of federal Recovery Act funds, which are totally unrelated to the waiver. Rhode Island has received $400 million in extra Medicaid funds under the Recovery Act and will receive about $470 million in total. These extra funds have enabled the state to reduce its own Medicaid contributions.
In short, while the global waiver has been a sweet deal for Rhode Island in many ways, states would find a Medicaid block grant a much more sour experience.