Issue Brief | Jun 16, 2017

Why Per Capita Caps Aren’t Just Managed Care for States

Deborah Bachrach, Patricia Boozang, and Anne Karl, Manatt Health

The American Health Care Act (AHCA), as passed by the House of Representatives on May 4, 2016, would overhaul federal financing of state Medicaid programs, and for the first time, would cap federal Medicaid funding. As policymakers debate the potential implications of per capita caps, it has been suggested that per capita caps are really no different than Medicaid managed care—a concept with which states are fully familiar and well able to manage. This Manatt Health policy brief tests that hypothesis by examining the similarities and differences between the federal per capita cap and a state’s per capita “cap” in Medicaid managed care spending.