Medicaid Cuts Will Impact Kids' Access to Health Care

Changes to Medicaid policies could impact children between $57 and $114 billion over the next 10 years.

That finding comes in a new analysis highlighting how changes to Medicaid policies would impact American children and the children’s hospitals who care for them. The Children’s Hospital Association commissioned Avalere Health to examine the financial impact of changes to three specific policies Congress is considering to reduce federal spending on Medicaid.

Key Policy Proposals and Their Effects

• Per Capita Cap: A per capita cap would create “per-enrollee” limits on federal Medicaid payments to states. Federal spending would increase based only on the number of enrollees instead of the cost per enrollee. This policy would reduce federal Medicaid spending on children’s health care by an estimated $57 to $114 billion over 10 years, depending on the inflation rate.
• Removal of FMAP Floor: Medicaid is funded by states and the federal government. The federal matching amount, or Federal Matching Assistance Percentage (FMAP), differs for each state based on its per capita income relative to the national average. A Congressional statute set the FMAP minimum at 50%. Removing the FMAP floor would reduce federal Medicaid spending on children’s health care by an estimated $57 billion over 10 years.
• Reducing the FMAP for the Expansion Population: The Affordable Care Act (ACA) sets the FMAP at 90% for the “ACA Expansion” population. Reducing the federal matching rate for this population would reduce overall federal Medicaid spending for adults and children by an estimated $675 billion over 10 years.

Each of these policy proposals would harm the Medicaid program at the national and state level. States would be forced to shift costs and make difficult decisions that negatively impact access to care for the nearly 37.5 million children covered by Medicaid and CHIP.

The Bottom Line

Nearly 50% of children in the United States are covered by the Medicaid/CHIP program. Changes to any Medicaid policy — regardless of whether it explicitly targets children — will prevent children covered by Medicaid from accessing the preventive care, treatments, and wrap-around supports they need to thrive. We urge policymakers to consider the profound implications these changes will have on the health and well-being of millions of children across the country.

Read the full report, including a state-by-state breakdown, from Avalere Health. And please tell your members of Congress we must protect Medicaid to ensure a healthy future for our children.