New GOP Affordable Care Act replacement plan would put costs on states and hospitals
The Republican’s plan to replace the Affordable Care Act, dubbed “A Better Way,” involves setting caps on funding for state Medicaid units that could shift those costs to states, hospitals and beneficiaries, according to a Kaiser Family Foundation report released Wednesday.
Indeed, the plan would convert federal Medicaid financing from an open-ended entitlement to a per capita allotment or a block grant, based on state choice, the report noted.
Under a Medicaid per capita cap, the federal government would set a limit on how much to reimburse states per enrollee. Payments to states would reflect changes in enrollment, the report said.
If costs are above per enrollee amounts, they could be shifted to states, providers and beneficiaries, the report said.
Kaiser said it's possible that the plan could give states an incentive to reduce Medicaid payment rates, restrict benefits and the eligibility for high-cost enrollees. Costs could be shifted to beneficiaries through premiums or cost sharing.
In turn, hospitals could end up bearing the cost of uncompensated care for beneficiaries who are unable to pick up a greater portion of the tab for healthcare.
This fundamental change in the financing of Medicaid to pre-set growth rates is meant to contain federal healthcare spending, but does not account for changes in the costs per enrollee beyond the growth limit, nor for variation in the cost of medical services, patient acuity or epidemics, the report said.
To achieve federal savings, the per capita growth amounts would be set below the projected rates of growth under current law, Kaiser said.
The proposal is part of a larger package designed to replace the Affordable Care Act, the report said. Often tied to deficit reduction, proposals to convert Medicaid's financing structure to a per capita cap or block grant have been proposed before, it said.
The per capita cap proposal is likely to be debated in Congress as part of broader healthcare policy and deficit reduction in an election year.
Twitter: @SusanJMorse
