The Impact of the AHCA on Federal and State Medicaid Spending and Medicaid Coverage

The American Health Care Act (AHCA) could cut federal Medicaid spending by more than $900 billion over a decade.

The Issue

As many as 14.8 million Americans could lose Medicaid coverage by 2022 if all states drop Affordable Care Act expansions and cut enrollment further to compensate for per capita caps and other federal funding cuts.

Key Findings

• Federal Medicaid spending could decrease by $938.3 billion, or 20.5 percent, from 2019 to 2028.
• State Medicaid spending could decrease by $78 billion over the same period.

Conclusion

Although the AHCA doesn’t require states to roll back Medicaid expansion, they would face practical limitations on their ability to cover the federal reduction in financial support without scaling back eligibility. How states respond to decreased federal spending on Medicaid could have an effect on the number of people receiving Medicaid coverage.

About the Urban Institute

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.