Block grant
[2] Through a block grant program for Medicaid,[4] for example, each state would receive a set amount of money from the federal government.
[5] Each state has to fill any funding gap if there is a difference between their spending and the amount set by the federal government.
[2] Critics, who are specifically against converting Medicaid into block grants, say that block grant "undermine the achievement of national objectives", "reduce government spending on domestic issues" where, for example, the "most vulnerable seniors, individuals with disabilities, and low-income children" would lose their health care through deep cuts in Medicaid.
[5] According to a January 11, 2019 Politico article, the Trump Administration was creating new guidelines to overhaul Medicaid in order to reduce health care costs for the poor through block grants, bypassing Congress.
[7]: 4 [8] In a March 16, 2017 New England Journal of Medicine article, the authors provided background on health care provisions for the poor in the 1950s and 1960s.
[Notes 2] When the cap was spent, states were responsible for cutting health costs to make up the difference by restricting who, what and how much care one could access.
[7] During the Nixon Administration (1969–1974) a new strategy, called "special revenue sharing" was developed and implemented from 1972 to 1986, to replace block grants.
According to The New York Times, in FY 1986 the year before revenue sharing was eliminated by the Reagan administration, the federal government "distributed $4.5 billion to 39,000 municipalities".
[10][Notes 4] Revenue sharing lost federal support under Reagan and was replaced by block grants in smaller amounts in 1987.
[13]: 4 According to a 2017 CBPP study, since 2000, funding for the 13 major low-income health, housing, and social services block grants has fallen by 37%, after adjusting for inflation and population growth.
Additionally, individual states may provide block grants to their political subdivisions, such as counties, towns, and school districts.
[15] In 2009, Carl Stenberg wrote that block grants "could contribute a greater degree of flexibility to the intergovernmental system, but their potential [was] often overstated and difficult to realize."
[17] According to a 2009 U.S. Office of Management and Budget report, in 2008 block grants received the lowest average score based on the Program Assessment Rating Tool (PART), a set of questionnaires developed by the George W. Bush Administration to assess the efficacy of various federal funding programs.
Those who support block grants, say that they were more cost-effective because they reduce federal administrative costs related to state and local government paperwork requirements.
[2] According to a June 2015 Center on Budget and Policy Priorities report, the amount of basic assistance that block grants provide has also fallen, as local governments spend their federal funds on other purposes.
[19] The CBPP study said that, "Unlike block grants, entitlement programs such as Medicaid and SNAP are highly responsive to changes in need.
This growth is critically important during recessions...Programs like Medicaid and SNAP would lose this responsiveness if turned into block grants.
[23] (His opponent, Vittus Qujaukitsoq, had argued for independence even if it meant losing the large annual block grant from the Danish state.
