Medicaid Per Capita Caps Jeopardize State Reforms Aimed at Medicare Enrollees

WASHINGTON, DC –  Medicaid per capita cap legislation threatens state initiatives to improve care integration and to keep more seniors and disabled Americans in their homes, according to an issue brief released today by the National Coalition on Health Care entitled “Medicare at Risk?
Exploring the Implications of Medicaid Per Capita Caps for Medicare and Its Beneficiaries.”

“By squeezing state Medicaid budgets, legislative per capita cap proposals, like those before the Congress now, could actually impede the very innovations and reforms that these Medicare beneficiaries and tax payers need,” stated NCHC President and CEO John Rother.

The newly released brief draws on both recent analysis of per capita cap proposals as well as an April 10, 2017 panel event sponsored by NCHC.

The key findings outlined in the issue brief are as follows:

• 1 in 5 Medicare beneficiaries also rely on Medicaid. They tend to have more complex and costly care needs than the average.
• State Medicaid programs are now investing in significant reforms of care for this dually eligible population.
• Per capita cap legislation would create a gap between the cost of care and the state’s per capita cap – squeezing state Medicaid budgets and programs for duals.
• Under this pressure, states could reverse their investments in home- and community-based services and shift utilization and costs back towards acute and post-acute services covered by Medicare.

“Over time, the fiscal pressure generated by per capita caps could push states back toward institutionalization and unnecessary hospitalization as the primary response to aging and disability,” said Rother. “That’s just not an acceptable outcome – for beneficiaries or for our nation’s fiscal future.”

The full text of the Issue Brief can be found here.