Trump Administration Opens Door for States to Block Grant Medicaid

An announcement this week from the top CMS official, Administrator Seema Verma, outlines the steps taken by the Administration to allow states to implement spending restraints for certain Medicaid beneficiaries. While the administration avoided using the term “block grant,” the introduced guidance would allow states to apply for Medicaid waiver authority to implement program flexibility in exchange for a capped federal Medicaid contribution.

As written, the waiver would apply only to non-disabled, non-elderly adult Medicaid populations—including those that gained coverage through the ACA's Medicaid expansion efforts. However, n4a and many other national advocates remain concerned that capping the federal share of Medicaid funding for states will inevitably force states to cut costs—and ultimately services—for other beneficiaries. Furthermore, the Administration's announcement outlines executive action that directly contradicts 2017 congressional action rejecting Medicaid caps and block grants. We fully expect that CMS's announcement will catalyze a number of lawsuits challenging enhanced state flexibility under this payment model.

Read the guidance.



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