Lowering Federal Matching Commitments to Medicaid
The Impact in 10 States and the District of Columbia
Ten states and the District of Columbia would face a shortfall of nearly half-a-trillion dollars ($468B) over the next decade if Congress reduces the amount it guarantees to states to run their Medicaid programs.
The Issue
For decades, the federal government paid for at least half of every state’s Medicaid costs. This guarantee is called the Federal Medical Assistance Percentage (FMAP) and starts at a floor of 50%.
Key Findings
- If the FMAP floor of 50% is reduced, 10 states (Cal., Colo., Conn., Md., Mass., N.H., N.J., N.Y., Wash., and Wyo.) and the District of Columbia would be affected.
- According to the analysis, the change would result in Medicaid funding cuts of $189.5 billion for disabled people, $161.1 billion for the elderly, and $50.1 billion for children in these 10 states, plus the District of Columbia.
- Researchers say if this reduction in federal funding were combined with other proposed federal cuts to the Medicaid program—like the funding support the federal government provides states that expanded eligibility for the Medicaid program—the loss in federal funds provided to these 10 states and the District of Columbia would balloon to $835 billion over the next decade.
Conclusion
Researchers conclude enacting this policy would place tremendous fiscal strain on states and likely result in healthcare coverage losses.
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