A per capita cap on Medicaid would limit the total amount the Federal government reimburses states for their Medicaid expenses based on the number of people they have enrolled.
The cap would be adjusted every year. It would go up or down with enrollment. And it would increase by the rate of inflation, plus maybe 1 percent.
But there’s no actual plan on the table, so who knows?
Right now, states get reimbursed for a certain percentage of their Medicaid spending. That percentage is based on the income level of the people in the state, and averages about 60 percent.
Except for the people covered under the 2014 Medicaid expansion. States get back 95 percent of every dollar spent on that group.
The federal government paid $614 for Medicaid in 2023. That’s twice as much as 10 years earlier.
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Meanwhile, the states’ share of Medicaid’s total expenses decreased by 10 percent, and the federal share increased by 10 percent.
Some Republicans are looking for a way to send some of that cost back to the states.
The Congressional Budget Office said the plan would reduce federal spending by between 8 percent and 12 percent on the $7.5 trillion in projected Medicaid spending through 2034.
Who would pick up the tab? The states. They’d be responsible for all the spending above their cap amount, rather than just a portion of it.
But there probably will be no cap. Speaker Mike Johnson told reporters on Monday that the idea was likely “off the table.” He added, “But stay tuned.” So, again, who knows?
That would be a win for Republicans in battleground states and swing districts. Many of them are opposed to any change that would cause people to lose health coverage.
Between 600,000 and 3.9 million people could wind up uninsured by 2034, depending on how Medicaid cuts were structured. That’s according to the Congressional Budget Office.
Fiscal hardliners like Rep. Chip Roy (R-Texas) aren’t giving up. “Well—I haven’t ruled it out,” he posted on social media, responding to Johnson’s comments.
With Republicans needing every possible vote to pass the budget reconciliation bill, holdouts for and against the cap both have leverage.
So, once again, who knows?
—Lawrence Wilson
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