For People Living with Disabilities, Medicaid Block Grants Have Devastating Consequences

This post is one in our series of blog posts on the harmful impacts of Medicaid block grants.

In late January, the Trump administration released its plan to offer states the option of converting their Medicaid funding into block grants. It is unclear how many states will apply for this new funding process, but the plan is a radical and dangerous shift in how the Medicaid program is currently funded. While the block granting of Medicaid would have widespread consequences, it could be especially harmful for people with disabilities and chronic health conditions. This is just one more piece of the Trump administration’s continuous assault on people living with disabilities and chronic illness.

While the new guidance is limited to the population that newly qualifies for Medicaid through the program’s expansion under the Affordable Care Act expansion, that group still includes many people with disabilities who went without coverage before the law was passed (often due to pre-existing conditions). Many people with disabilities qualify for Medicaid not through their disability status, but other factors, such as income level. Since they qualify through other means, they are part of the population that could be impacted by this guidance.

With the implementation of this guidance, consumers are at risk of having trouble accessing prescription drugs, could face more out-of-pocket costs and could lose access to supportive services like non-emergency medical transportation and certain long-term services and supports, such as home and community-based services. States will be incentivized to cut services because of the proposal’s changes to Medicaid reimbursements to states. Instead of the federal government guaranteeing it will fully reimburse a certain percentage of program costs (ranging from 50-77%), states will be fully responsible for costs that go above a predetermined capped amount. People with complex health needs are especially reliant on these services, and thus would bear an acute burden as a result of the new policy. 

Additionally, the ability of states to provide innovative services to address the social needs of people with complex health conditions would be constrained by the funding limitations the guidance creates. From the standpoint of accessibility, transparency, and equity for consumers, this guidance fails people with disabilities and complex needs. It allows for less federal oversight on managed care providers, which means consumers could see decreased provider availability, fewer covered services, and greater inequities in access to quality care.

This guidance is one piece of a larger attack on the disability community. In addition to the proposed Medicaid block granting, the Trump administration is simultaneously proposing stricter and more frequent disability reviews to qualify for Social Security benefits.  The administration also enthusiastically supports state efforts to implement burdensome work reporting requirements and coverage lockouts that push beneficiaries off their Medicaid coverage. In Arkansas, 18,000 people have lost their Medicaid coverage over the course of seven months due to a confusing and poorly communicated work reporting system, with many people only finding out they lost their coverage when they went to pick up a prescription or make a doctor’s appointment. The administration has also proposed raising rents for people with disabilities living in public housing, jeopardizing the housing security of a community that already faces unfair barriers to affordable housing. The consequences of these Trump administration policies offer a glimpse into the potential harm of Medicaid block granting would cause.

The status quo already fails people with disabilities, especially those with invisible disabilities that are difficult to diagnose and subject to greater scrutiny. People with disabilities also face the additional barriers of job discrimination and a lack of accommodation in the workplace. This leaves them significantly more likely to be underemployed or unemployed and in need of Medicaid to access health coverage.

Medicaid is a lifeline for the disability community, and any policy that seeks to narrow eligibility would put at risk the lives and livelihood of millions of people with disabilities across the country.