Analyzing the Effect of Per Capita Caps on the Medicaid Expansion Population
Cutting federal Medicaid spending by capping how much money the federal government provides to states that expanded Medicaid per enrollee would shift billions of dollars of expenses to states over the next decade.
The Issue
Researchers analyzed the financial effects of enacting per capita caps on individuals who become eligible for Medicaid as a result of their state's decision to expand Medicaid eligibility under the Affordable Care Act.
Key Findings
- A per capita cap on the Medicaid expansion population would result in a reduction in federal contributions by $230 billion to $276 billion over 10 years.
- Relative to current spending on the expansion population, Medicaid spending would be cut by 14.8 percent to 17.8 percent.
- Relative to current spending on the expansion population, states would have to increase spending by 133.3 percent to 159.8 percent.
Conclusion
Researchers conclude that imposing per capita caps on the Medicaid expansion population would require states to substantially increase Medicaid spending to maintain their Medicaid programs as currently structured.
About the Author/Grantee
The nonprofit Urban Institute is dedicated to elevating the debate on social and economic policy. For nearly five decades, Urban scholars have conducted research and offered evidence-based solutions that improve lives and strengthen communities across a rapidly urbanizing world. Their objective research helps expand opportunities for all, reduce hardship among the most vulnerable, and strengthen the effectiveness of the public sector. Visit the Urban Institute’s Health Policy Center for more information specific to its staff and its recent research.
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