Federal Medicaid Handcuffs Harm States and the Truly Needy
As part of the Families First Coronavirus Response Act (FFCRA), Congress offered states an additional 6.2 percent increase in funding for their traditional Medicaid costs. While this was portrayed as pandemic-related relief, there was an insidious catch: In exchange for the increase in funding, states had to relinquish control over significant aspects of their Medicaid programs.
As long as states accept the funding boost, they cannot change Medicaid eligibility standards, adjust enrollment processes, or remove individuals from their Medicaid rolls—even if they have become ineligible or were never eligible in the first place. Individuals can only be removed from the program if they voluntarily disenroll or leave the state.
Unsurprisingly, these federal handcuffs caused Medicaid enrollment to spike to record-high levels, including individuals who were only briefly eligible during the pandemic and individuals who were enrolled into the program improperly. In order to truly return to normal, policymakers must act to restore common sense to Medicaid and unshackle the handcuffs states have been forced to wear.