Alternatives for Improving the Distribution of Funds to States

HRD-93-112FS: Published: Aug 20, 1993. Publicly Released: Aug 20, 1993.

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Pursuant to a congressional request, GAO provided information on alternatives for improving the distribution of Medicaid funds among states.

GAO found that: (1) the alternatives for distributing Medicaid funds are based on the number of people in poverty and a state's ability to finance program services from state revenues using total taxable resources (TTR); (2) alternative 1 would increase funds to 23 states and decrease funds to 28 states; (3) alternative 2 would decrease the number of states gaining funds to 18 and increase the states losing funds to 33; (4) alternatives 3 and 4 would increase funds to about 25 states and reduce the number of states losing funds; and (5) other Medicaid formula alternatives substitute personal income for TTR, but the number of states that gain and lose funds and the federal guaranteed minimums under these alternatives are similar to TTR alternatives.

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