Trump cuts off funding to state and local agencies in health care plan
President Donald Trump on Friday abruptly ended a $1.9 billion block grant to state health departments, putting the spotlight on a potentially significant shift in the nation’s health care system.
Trump’s decision was a rare move by a president who has sought to rein in the state and city governments that control the Medicaid program for the poor and disabled, which provides coverage for millions of low-income Americans.
The announcement followed months of speculation that the White House would move away from the block grant in an effort to get lawmakers on board with its healthcare overhaul.
The move is likely to cause consternation among state officials who were seeking a much more robust federal funding commitment for the program.
“It was the right thing to do,” said Republican state Sen. Matt Heinrich of Michigan, who has led the effort to save the block grants for years.
Heinrich was the lead sponsor of a House-passed bill last year to end the federal funding.
“It’s time to do it.
It’s time for us to have some sort of a bipartisan solution,” he said.
Trump signed a sweeping executive order to end federal funding for the block-grant programs in February, citing an unprecedented federal budget crisis and declining enrollment as his top priorities.
The $1 billion cut to the Medicaid block grants comes as Trump is under fire for slashing Medicaid funding in recent weeks, citing the cost of health care and rising premiums.
The White House said it would not be able to afford the program’s expansion in 2018, which is set to expire at the end of March.
Trump has sought for years to make Medicaid a way for states to expand coverage to the poor.
He has also called for a “sustainable” expansion of the program to cover a much larger population.
Democrats and advocates have said the block funding cuts are too small and would likely not save the health system from a severe funding crunch.
Trump, however, has said that the cuts are necessary to help ensure states will get the money they need to make good on their promises to expand Medicaid.
Democrats say the cuts to the block funds will leave states to cover the costs of their poor and sick residents without an expansion.
“Trump’s budget will make it harder for people to get access to quality health care for the tens of millions of Americans who are currently covered under the blockgrants,” said Sen. Patty Murray, D-Wash., who is leading the push to end Medicaid.
Murray’s office said she had been in talks with state officials and health care experts about how the funding would be distributed.
Murray and her Democratic counterpart in the Senate, Sen. Kamala Harris, have also been pushing for a federal matching fund to help states meet their obligations.
Murray said the new funding would provide about $300 million in additional funding over the next two years to help make Medicaid more efficient.
She added that states would also have the option of cutting some federal grants in order to make up the difference.
State officials had been eyeing a block grant proposal that would have covered a much smaller number of Medicaid enrollees.
That idea was rejected by Trump in January, and he has also cut off federal funding to states that do not comply with the Affordable Care Act’s Medicaid expansion.
But the White Star Line cut off the funding Friday, saying the administration has failed to come up with a credible plan to meet the program requirements.
The decision comes as the White Senate Office of Management and Budget released a proposal to expand federal Medicaid payments to the states.
The proposal would increase the payments to $3,600 a month for all adults and $7,300 for children.
The money would be spent on coverage for all enrollees who do not qualify for Medicaid or other federal programs.
The administration also announced a $500 million increase in funding for Medicaid in 2020, to $15,100 a month, from $10,600 in 2020.
The $1,000-per-person increase will also help pay for additional outreach to Medicaid enrollee populations.