by Edward Alan Miller, Professor of Gerontology and Public Policy

Although ultimately withdrawn before a vote, the American Health Care Act (AHCA) proposed by House Republicans would have radically restructured Medicaid by converting the federal government’s open-ended commitment to match state government spending with a per-capita cap on the amount of money a state could receive for each enrollee. An alternative to per-capita caps, Medicaid block grants, is also favored by some Republicans but was not included in this particular proposal. Block grants would replace the federal government’s open-ended financial commitment with a fixed up-front annual allotment for the entire covered population.

Advocates of per-capita caps and block grants invariably cite Rhode Island’s Global Medicaid Waiver as the poster child for block-granting Medicaid nationally. This continued with the most recent debate to restructure Medicaid (see, for example, National Review, The Hill). In the waning days of the George W. Bush administration, Rhode Island’s Republican administration negotiated the state’s global waiver which, beginning in 2009, included a $12.1 billion, five-year cap on total state and federal spending. Block grant proponents point out that Rhode Island was the first state to operate its entire Medicaid program under a global spending cap. In return, proponents claim that Rhode Island received unprecedented flexibility from burdensome federal rules that stymie innovation. They also claim Rhode Island achieved tens of millions of dollars in savings while spending several billion dollars less than the agreed upon cap.

The reality is quite different. Read more.

Edward Alan Miller specializes in aging and long-term care, telemedicine and e-health, intergovernmental relations, program implementation and evaluation, and Medicaid. He also serves as the editor-in-chief of the Journal of Aging & Social Policy. He wrote about Rhode Island’s Global Waiver in Block Granting Medicaid: A Model for 21^st Century Health Reform? (2013 hardcover, 2015 paperback, Routledge, Taylor & Francis Group).