In order to preserve the program and retain limited resources for the neediest populations, Building a Better America begins with the reforms included in the “American Health Care Act.” The AHCA institutes a per capita cap system that puts Medicaid on a budget for the first time since its inception, converting it from an open-ended entitlement program to a manageable safety net. The per capita design protects resources for those in need by designating funds based on population category: children and pregnant women, the blind and disabled, the elderly, and able-bodied adults. This ensures that states and the federal government can provide care based on a per-person payment structure, which accounts for the variation in spending amongst the different categories of patients. As such, a per capita cap targets funds to the most vulnerable. Its purpose is to catch those Americans who fall, without trapping those who can climb out of poverty.
The “American Health Care Act” also promotes state flexibility. For example, states could opt for a block grant, rather than the per capita allotment. This would promote innovation on the state level, and encourage states to root out waste, fraud, and abuse. AHCA also enables each state to set the benefits it believes are essential for its unique population; this would better narrow the scope of funding to meet the needs of individuals.
Building a Better America includes the AHCA reforms to put Medicaid on a budget, and calls for the following additional reforms to make it work for patients:
• Apply Work Requirements to Medicaid. The budget proposes to advance a work requirement for certain adults enrolled in Medicaid who are able to work. This proposal suggests that an able-bodied, working-age, non-pregnant adult without dependents could qualify for Medicaid only if he or she were actively seeking employment or participating in an education, training, or community service program. These requirements would help target resources toward the most vulnerable populations, while at the same time making Medicaid available for those on the precipice of poverty who are transitioning into economic stability.
• Enhance State Flexibility. The budget promotes state flexibility through the AHCA block grant option, in addition to further legislative options beyond structural reform. The budget encourages states to institute changes to improve program management. For example, states could set reasonable cost-sharing standards for able-bodied adults, address inappropriate use of emergency facilities, or strengthen eligibility processing to reduce wait times.
• Improve Reporting to Reduce Risk. The Government Accountability Office has listed Medicaid as high-risk since 2003. The budget proposes to follow GAO’s recommendations for reducing improper payments, growing expenditures, and poor access to quality care. The most significant aspect of this effort is the enhancement of reporting by states on annual Medicaid data, along with greater coordination between the Centers for Medicare and Medicaid Services and state auditors.
