Both the House-passed American Health Care Act (AHCA) and the Senate’s draft Better Care Reconciliation Act (BCRA) of 2017 propose major changes to Medicaid’s financing structure. These include caps on federal funding for nearly all Medicaid beneficiaries and services. Currently the federal government covers a share of all Medicaid expenditures, but a per capita cap would eliminate this guarantee. Instead, states would be allocated a set amount per beneficiary. These amounts would be added together to establish an overall limit on expenditures that the federal government will match.

To understand the implications of a per capita cap for California and the 13.5 million beneficiaries served by Medi-Cal (California’s Medicaid program), Manatt Health prepared an analysis for the California Health Care Foundation (CHCF) that...