Democrats Warn HHS Off Block-Granting Medicaid To States

House Democrats said Tuesday they will reject a portion of President Trump's budget that would convert Medicaid from an open-ended entitlement to fixed amounts of money for states, though they do fear the administration will go around them.

Mr. Trump's fiscal 2020 budget would shift $1.2 trillion in Medicaid spending over 10 years to block grants starting in 2021, while eliminating funding Obamacare's expansion of the program in dozens of states.

Democrats say that's a non-starter, arguing a fixed allotment would result in states rationing care and knocking people out of Medicaid, which insures tens of millions of low-income Americans. Similar fears contributed to the failure of a GOP plan to repeal and replace Obamacare in 2017.

"Congress has already rejected attempts to block-grant Medicaid, so it's deeply troubling to see this administration double down," said Rep. G.K. Butterfield, North Carolina Democrat.

Mr. Butterfield demanded to know whether HHS plans to urge states to request a block grant, anyway, without the participation of Congress. They said cited news reports and swirling rumors that HHS planned to issue guidance inviting states to do just that, using existing waivers.

Health Secretary Alex Azar said his agency doesn't plan to go around lawmakers to make changes, though he couldn't predict whether states will begin asking for block grants.

"Absent statute, we can't force a state to do anything like that in Medicaid," Health Secretary Alex Azar testified. "That would have to be a governor and legislature coming to us."

Mr. Azar testified that if the agency did receive that kind of waiver request, it would have to asses it with legal counsel and the White House Office of Management and Budget.

Mr. Butterfield wanted Mr. Azar to promise that no enrollee would lose coverage or their doctors from any such waiver.

"You couldn't make that commitment about any type of waiver," Mr. Azar said, arguing they each have redistributive effect.

The back and forth was part of a broader hearing on Mr. Trump's 2020 budget proposal.