What If Chairman Ryan’s Medicaid Block Grant Were Already in Effect?

House Budget Committee Chairman Paul Ryan’s proposal to block-grant Medicaid would cut federal funding by one-third by 2022 and even more after that, we recently explained.  To help show how states would likely fare under the proposal over time, we compared how much federal funding they would have received under the block grant if it had been in effect for fiscal years 2001-2010 to what they actually received (excluding the temporary funding increases that the White House and Congress provided during the last two recessions). We found that the Ryan block grant — which the House passed as part of Chairman Ryan’s overall budget — would have cut federal Medicaid funds to most states by more than 35 percent by 2010 and to several of them by more than 50 percent. Every state would have received substantially less from the federal government than it actually received, but some states would have received much, much less.

• States would have received $555 billion — or 31 percent — less over the 2001-2010 period.
• In 2010 alone, the cuts in federal funding would have totaled about $81 billion, or 37 percent (see table).

To cope with cuts of this size, states would have to boost their own funding substantially or, more likely, sharply scale back their Medicaid programs by tightening eligibility, shrinking benefits, and cutting reimbursement rates to providers. Such changes would add millions to the number of uninsured Americans.  Last year, when Chairman Ryan included a similar Medicaid block-grant proposal in his budget, the Urban Institute estimated that it would prompt states to drop between 14 million and 27 million people from Medicaid by 2021 — in addition to the 17 million people who would no longer gain coverage because of the Ryan budget’s repeal of the health reform law’s Medicaid expansion.

Estimated Cuts If Ryan Medicaid Block Grant Had Been in Effect, 2001-2010 ($ millions)
STATE	Reduction in Federal Funds, 2010	Percentage Cut, 2010
NATION	$80,724	37%
Alabama	1,015	31%
Alaska	407	53%
Arizona	4,477	71%
Arkansas	1,444	49%
California	7,109	34%
Colorado	808	40%
Connecticut	718	26%
Delaware	335	52%
DC	432	35%
Florida	4,397	46%
Georgia	1,885	37%
Hawaii	305	41%
Idaho	490	52%
Illinois	2,757	36%
Indiana	1,597	41%
Iowa	688	35%
Kansas	488	33%
Kentucky	1,308	33%
Louisiana	1,383	30%
Maine	445	30%
Maryland	1,564	44%
Massachusetts	1,853	32%
Michigan	2,656	36%
Minnesota	1,447	38%
Mississippi	1,278	41%
Missouri	2,311	45%
Montana	229	36%
Nebraska	207	21%
Nevada	380	50%
New Hampshire	121	18%
New Jersey	1,105	22%
New Mexico	1,418	57%
New York	5,707	23%
North Carolina	2,645	39%
North Dakota	99	23%
Ohio	4,073	42%
Oklahoma	1,109	44%
Oregon	927	37%
Pennsylvania	3,666	36%
Rhode Island	268	27%
South Carolina	1,235	35%
South Dakota	157	31%
Tennessee	1,946	35%
Texas	6,561	42%
Utah	491	40%
Vermont	363	49%
Virginia	1,445	45%
Washington	918	26%
West Virginia	444	24%
Wisconsin	1,531	39%
Wyoming	86	32%
Source:  CBPP analysis based on CMS Medicaid spending data.  To determine states’ block grant amounts under the Ryan proposal, we use federal Medicaid spending in 1998 as the base, adjusted annually by national population growth and the growth in the Consumer Price Index.  We exclude federal Medicaid spending related to temporary federal matching rate increases in 2003, 2004, 2009, and 2010.