The Impact of Medicaid Block Grants

One solution to the federal budget crisis being offered up is block granting Medicaid – the shared state and federal program that supports not only health care, but also home and community based services and residential programs for people with intellectual and developmental disabilities in Indiana.

What would a block grant mean? Instead of a program that does not limit  federal matching funds Indiana receives for eligible people to receive health care and nursing home services, the state would receive a set amount – one block of money for Indiana to carve up to meet many needs.

Today the more people who are served the more federal money is brought into the state.  That is one reason Indiana’s Medicaid Waiver program is growing –  the state puts up state money and that brings in federal matching money.  Currently, for every dollar spent on Medicaid in Indiana, 37 cents is state money and 63 cents is federal money.

Under a block grant, the state would receive a set amount, along with the promise of fewer federal regulations.  To some that sounds like a good deal.

The major areas for Medicaid funding are hospitals, nursing homes, prescription drugs, and programs for people with disabilities.  And while the number of people with I/DD served by Medicaid is small, the cost to serve people with I/DD is high – which presents a challenge should Medicaid be block granted.

With a capped amount for the entire state, there will be intense competition for limited dollars.  The number of older folks needing nursing home and  in home care is quickly growing.  The cost of prescription drugs and medical care continues to rise.  How will people with I/DD fare in such a competition?

Governor Romney has said he wants to block grant Medicaid, but there are few details about how it would be done.   Many legislators agree with him.   Frustration with the current system has led many to believe that anything  is better than the current system.

One thing is for sure – the current system will change.  That makes The Arc’s need for advocacy at the national and state level even more important.

When a candidate asks for your vote, ask how he or she would address Medicaid reform, and ask how Hoosiers with I/DD will be served under Medicaid reform.

Change is already underway and more change is coming.   Your voice is  needed to shape that change.