The Trump administration and the new Republican Congress are primed to make big changes in Medicaid and Medicare in 2017.
GOP leaders such as House Speaker Paul Ryan and HHS secretary-nominee Dr. Tom Price have announced they will target the two huge healthcare programs for major restructuring and budget savings. Medicare spending grew 4.5% to $646.2 billion in 2015, while Medicaid spending grew 9.7% to $545.1 billion that year, with states contributing about 40% of that sum.
Republicans are likely to try to convert Medicaid from an entitlement program for low-income, elderly and disabled Americans to a capped program of fixed federal contributions to the states, either through flat block grants or per-capita contributions. They have not yet offered details on how those payments would be calculated or whether they would keep pace with medical inflation.