In this paper, we make estimates of a policy that would impose per capita caps on the Medicaid expansion population created by the Affordable Care Act. Per capita caps limit the growth in federal spending on a per-enrollee basis. This paper builds upon previous work that imposed per capita caps on the entire Medicaid program. In response to concerns about the dramatic impact of that policy, per capita caps on the expansion population would represent a more narrow targeted policy.

Why This Matters

In April 2025, the US Senate and House of Representatives adopted a budget resolution. News outlets have reported that the Senate and the House have agreed to pursue at least $1.5 trillion in spending cuts overall. Previously, the House Energy and Commerce Committee had proposed $880 billion in spending cuts for programs under its jurisdiction. Most of this would have fallen to Medicaid, which is expected to remain true under the reconciliation bill. Per capita caps on the Medicaid expansion population would be one way to contribute to the budget cuts that would be needed.

What We Found

We found that a per capita cap on the Medicaid expansion population would result in a reduction in federal contributions over 10 years of between $230 billion and $276 billion. The policies would represent a 3.1 to 3.7 percent reduction in federal spending; relative to federal spending on the expansion population, these would be cuts ranging from 14.8 to 17.8 percent. States would have to increase state spending on Medicaid by 5.2 to 6.2 percent to maintain the programs as currently structured. These increases in spending would represent increases of between 133 and 160 percent relative to current spending on the Medicaid expansion. We also found that states with lower per capita incomes and that expanded Medicaid would face the largest percentage increases in their state spending to maintain their programs.

How We Did It

We developed a data set that estimated annual spending and enrollment for each eligibility group in every state from 2026 through 2035. We begin with data from MACPAC that had enrollment and spending data for earlier years. For the expansion population, we relied on the Urban Institute’s Health Insurance Policy Simulation Model for 2026. We increased spending and enrollment by Congressional Budget Office projected growth rates for each eligibility group over the 2026 to 2035 period. Thus, we have spending and enrollment increases that agree with Congressional Budget Office projections but reflect known variation in state spending and enrollment.