Trump wants to bypass Congress on Medicaid plan

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The Trump administration is quietly devising a plan bypassing Congress to give block grants to states for Medicaid, achieving a longstanding conservative dream of reining in spending on the health care safety net for the poor.

Three administration sources say the Trump administration is drawing up guidelines on what could be a major overhaul of Medicaid in some states. Instead of the traditional open-ended entitlement, states would get spending limits, along with more flexibility to run the low-income health program that serves nearly 75 million Americans, from poor children, to disabled people, to impoverished seniors in nursing homes.

Capping spending could mean fewer low-income people getting covered, or state-designated cutbacks in health benefits — although proponents of block grants argue that states would be able to spend the money smarter with fewer federal strings attached.

Aware of the political sensitivity, the administration has been deliberating and refining the plan for weeks, hoping to advance an idea that Republicans since the Reagan era have unsuccessfully championed in Congress against stiff opposition from Democrats and patient advocates. During the Obamacare repeal debate in 2017, Republican proposals to cap and shrink federal Medicaid spending helped galvanize public opposition, with projections showing millions would be forced off coverage.

In addition to potential legal obstacles presented by moving forward without Congress, the administration effort could face strong opposition from newly empowered House Democrats who’ve vowed to investigate the administration’s health care moves.

The administration’s plan remains a work in progress, and sources said the scope is still unclear. It’s not yet known whether CMS would encourage states to seek strict block grants or softer spending caps, or if new limits could apply to all Medicaid populations — including nursing home patients — or just a smaller subset like working-age adults.

A spokesperson for CMS did not comment on the administration’s plans but indicated support for the concept of block grants.

“We believe strongly in the important role that states play in fostering innovation in program design and financing,” the spokesperson said. “We also believe that only when states are held accountable to a defined budget — can the federal government finally end our practice of micromanaging every administrative process.”

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