Long-term care providers are skeptical that they will see additional benefits, touted by federal officials Thursday, under a new federal program that would allow states to receive a fixed amount of federal funding for Medicaid for select adult beneficiaries. 

“It is very unlikely that block grant waivers would result in significant funds available for reinvestment in Medicaid,” LeadingAge President and CEO Katie Smith Sloan said. “In fact, the purpose of block grants is to reduce spending on the Medicaid program, often to reallocate state dollars to other programs and policy areas.”

To much fanfare, the Centers for Medicare & Medicaid Services Thursday announced its new “Healthy Adult Opportunity” program and guidance. The optional program allows participating states to receive a block grant for a specific population enrolled in Medicaid — adults under the age of 65 who aren’t eligible for Medicaid on the basis of disability or who aren’t eligible under a state plan.

“[Medicaid is] already the nation’s largest payer of long-term care and as the nation’s baby boomers age costs for those individuals is expected to rise 500% by 2050,” CMS Administrator Seema Verma said. “This looming cost crisis threatens the viability of the program.”

LeadingAge President and CEO Katie Smith Sloan

Verma stated that Medicaid’s ability to remain sustainable is becoming difficult and noted that it’s now the “first or second largest budget items for states.” She added that the program is not designed to hurt the elderly or long-term care services and could actually help them down the road.

“Low-income adults, children, pregnant women, elderly adults and people eligible on the basis of disability will not be directly affected — except from the improvements that result from states reinvesting savings to improve Medicaid for everyone,” she said.

The Trump administration’s new program would “only make it harder” for providers to receive proper funding, according to Smith Sloan. 

“Inadequate funding already plagues providers of long-term services and supports, who depend upon Medicaid as the primary payer for most costs of care,” she said. 

“As it is, LeadingAge members must fight for every penny from state coffers allocated to cover the costs of providing vital long-term services and support to older adults and people with disabilities. This new type of waiver would only make it harder,” Smith Sloan added. 

Mike Cheek
AHCA’s Mike Cheek

States that participate will receive the block grant funding over an initial five-year period. The funding can be renewed for a period of up to 10 years, if successful. Participating states will also be required to report on several quality measures that are currently optional and real-time performance indicators. 

The American Health Care Association added that it is reviewing the guidance for the program. 

“While the new initiative announced today does not appear to be directed at long term-care services, this is an important issue because most people who reside in nursing centers rely on Medicaid, as well as tens of thousands of seniors in America’s assisted living communities,” Mike Cheek, AHCA’s senior vice president of reimbursement policy, said. 

“We will continue to work with our members, CMS and other stakeholders to ensure that we can provide the quality care on which our nation’s most vulnerable residents rely,” he added.