What is an example of Block Grant?
Types of Federal Grant Funding
- Project Grant Funding. Project grant funding is awarded to subsidize certain specific services, for a fixed period of time.
- Formula Grant Funding. Formula grant funding is used for ongoing programs that serve a particular group of people, such as children with disabilities, or low-income students.
- Block Grant Funding. ...
- Categorical Grant Funding. ...
Why do states prefer block grants?
Why do states prefer block grants? Block grants are given to states or communities and they decide how to spend the money. States prefer block grants because there are less strings attached and the money can be used for a broader purpose. What is a block grant example? Block grants provide funding for eligible activities identified in authorizing legislation.
What is a Block Grant used for?
What are the Purposes of a Block Grant? Grantees use the block grant programs for prevention, treatment, recovery support, and other services to supplement Medicaid, Medicare, and private insurance services. Specifically, block grant recipients use the awards for the following purposes:
What is a federal government Block Grant?
- Substance Abuse Prevention and Treatment Block Grant.
- Community Development Block Grant.
- Energy Efficiency and Conservation Block Grant.
- Social Services Block Grant.
- Temporary Assistance to Needy Families.
- Indian Housing Block Grant.
- Community Mental Health Services Block Grant.
- What Are Block Grants?
What is the purpose of a block grant?
Block grants are awarded by the Federal government to state and local governments for broadly defined purposes — for example, social services or community development. Block grants are given primarily to general purpose governmental units in accordance with a statutory formula.
What is an example of a block grant?
Perhaps the most well-known block grant (and the one Paul Ryan wants to use as a model for other programs) is TANF. The law converted a cash assistance program known as Aid to Families with Dependent Children (AFDC) into a block grant now known as Temporary Assistance for Needy Families (TANF).
What are block grants in simple terms?
Definition of block grant : an unrestricted grant made by the U.S. federal government to state and local governments to be used at their discretion to pay especially for social services that were formerly paid for through specific federal programs.
What are advantages and disadvantages of block grants?
Welfare is used to help support low income families and the Low-Income Home Energy Assistance Block Grant is assistance to low-income families to help pay energy bills. The advantage of block grants is that it is less restrictive, but a disadvantage could be the use of the money ineffectively.
What is the biggest problem with block grants?
A block grant wouldn't respond the same way to a faltering economy and greater need. Fixed funding levels would require states to absorb higher costs — or to cut eligibility or benefits. And the economy would lose an automatic stabilizer, which would worsen the downturn.
Why are block grants good for citizens?
Block grants provide state and local governments funding to assist them in addressing broad purposes, such as community development, social services, public health, or law enforcement, and generally provide them more control over the use of the funds than categorical grants.
What are two modern examples of block grants?
Examples of Block GrantsThe Community Development Block Grant Program (CDBG) ... Mental Health Block Grant (MHBG) ... Social Services Block Grant Program (SSBG)
Why do block grants give power to the states?
Block grants are federal grants-in-aid that allow states considerable discretion (within broad limits) about how the funds will be spent. These give greater flexibility to state political actors to tailor programs to the state's particular needs than do categorical grants.
Are block grants taxable?
A: Yes, all block grant payments to applicants are taxable income and are subject to 1099 reporting with the IRS.
How are block grants distributed?
Block grants are fixed-sum federal grants to state and local governments that give them broad flexibility to design and implement designated programs. Federal oversight and requirements are light, and funds are allocated among recipient governments by formula.
What is the difference between a grant program and a block grant?
Block grants are distinct from discretionary grants because they generally allow for more autonomy and flexibility to the states to decide how to implement the program. States may use the block grant funding to establish a program or to make sub-awards to local organizations to provide the services within their region.
Which is one of the biggest problems with federal block grants?
What is one of the biggest problems with federal block grants? There is a need for greater accountability in how the funds are actually spent by the states.
What is a block grant?
A block grant is a noncompetitive, formula grant mandated by the U.S. Congress. Eligible entities must submit an annual application to demonstrate statutory and regulatory compliance in order to receive the formula-based funding. SAMHSA is responsible for two block grant programs:
What is a grantee for mental health?
Grantees use the funds to provide comprehensive, community-based mental health services to adults with serious mental illnesses and to children with serious emotional disturbances and to monitor progress in implementing a comprehensive, community-based mental health system.
What is priority treatment and support services?
Fund priority treatment and support services for individuals without insurance or for whom coverage is terminated for short periods of time. Fund those priority treatment and support services that demonstrate success in improving outcomes and/or supporting recovery that are not covered by Medicaid, Medicare, or private insurance.
Does SAMHSA use weighted population at risk index?
For the MHBG, SAMHSA uses similar factors in state and territory allotment calculations, except that the Weighted Population-at-Risk Index replaces the Population-at-Risk Index. In addition, different statutory minimum allotments apply.
What is a block grant?
Block grants are federal funds earmarked for specific state or local programs. A block grant is supported by federal funds but administered by state or local governments. Most block grants support housing, health, or other social services. Block grants were designed to provide funding for those services with relatively few strings attached, ...
What is CDBG program?
The CDBG program, administered by the Housing and Urban Development agency, is broadly defined as working to ensure decent affordable housing, to provide services to the most vulnerable in our communities, and to create jobs through the expansion and retention of businesses, " according to the agency.
When did block grants start?
Block grants have been in use in some form since the 1950s. Most have supported social services, public health services, or community development programs. Critics of block grant programs cite the relative lack of federal oversight as a problem.
Who is Will Wills?
He developed Investopedia's Anxiety Index and its performance marketing initiative. He is an expert on the economy and investing laws and regulations. Will holds a Bachelor of Arts in literature and political science from Ohio University. He received his Master of Arts in economics at The New School for Social Research.
How much will the Ryan budget cut Medicaid?
The so-called Ryan budget plan would make Medicaid a block grant and in the process reduce federal spending on the program by an estimated $771 billion between fiscal 2012 and 2021, according to the Congressional Budget Office. By fiscal 2030, federal Medicaid spending would be halved, according to CBO. Among other things, the plan would eliminate ...
Is Medicaid a block grant?
Cannon and Edwards said making Medicaid a block grant would save taxpayers in two ways: Less federal cost and state officials would have greater incentive to root out fraud and abuse. They also say it could help push more people into the private market for health care. The cons.
Who is Michael Cannon?
Michael Cannon, director of health policy studies at the libertarian Cato Institute, has called Medicaid a massive and irresponsible redistribution of the nation's wealth, shifting dollars from high-income states (such as New York) to lower-income states (such as Mississippi.)
What is the opposite of block grants?
The opposite of block grants is categorical grants , which are chunks of money given by the federal government to state and local governments that have far more rules attached to them.
Why are block grants preferred by Republicans?
Block grants are generally preferred by Republicans because of the freedom allowed in the spending whereas categorical grants are generally favored by Democrats because the regulations attached help ensure the original goals of the grant are met. To unlock this lesson you must be a Study.com Member. Create your account.
What is TANF grant?
TANF is commonly called welfare. This block grant replaced an earlier categorical grant called Aid to Families with Dependent Children (AFDC), which placed a lot of requirements on states. Now, under TANF, states have more control over how money is spent.
What did Paul Ryan propose to overhaul?
For example, former Republican Vice Presidential Candidate Paul Ryan has proposed overhauling the Medicare and Medicaid systems by converting them from categorical grants to block grants. Ryan argued that block grants give local states more control, allowing them to decide how they should spend money.
How many block grants were there in 2013?
In the 2013 fiscal year, the federal government had 25 block grants, as reported by the Congressional Research Service. One of the biggest block grant programs is called Temporary Assistance for Needy Families, or TANF for short. TANF is commonly called welfare.
What is the federal government?
In a federal system, the federal government is in charge of certain government functions (for example, national defense), and the local and state governments are in charge of other government functions (for example, education). But the federal government often tries to influence state and local governments by offering money grants in exchange ...
What is the difference between a car loan and a personal loan?
With a car loan, you can only use the money lent to you to buy a car. But with a personal loan, you can use the money for whatever purpose you want. Likewise, in a categorical grant, a state or local government can only spend the money in a certain way.
What is a per capita cap?
A per capita cap allows federal funding to adjust for changes in enrollment but not health care costs, while an aggregate cap ( also known as a block grant) puts states at risk for both higher costs and increased enrollment. States that cover new populations under the capped demonstration — for example, taking up the ACA Medicaid expansion for ...
How many pages are there in CMS guidance?
CMS monitoring after the fact could, however, result in a state having to revise their policies at a later time. The guidance — at nearly 60 pages — raises many questions and requires more analysis. Two observations, however, are certain to be true.
When are caps set?
Caps are set when the waiver is first approved and are applied annually. They are based on states’ historical spending for the waiver population or for newly covered populations, based on CMS estimates that can be adjusted later using state expenditure data.
Can states apply for Medicaid block grants?
New guidance from the Trump administration allows states to apply for Medicaid block grants that place funding caps on the federal government’s contribution but allow states more flexibility. Under the Medicaid block-grant demonstrations, people’s coverage and access to care will be at risk. Yesterday the Trump administration issued sweeping new ...
Does Section 1115 waiver include funding caps?
The administration already has permitted most of these policies under section 1115 waivers that do not include funding caps, but some of the flexibility is new. For example, states could restrict their prescription drug formularies and stop providing wraparound benefits for expansion adults who are medically frail.
Does Medicaid have a cap?
Under Medicaid law, states and the federal government jointly finance the cost of the program; all program expenditures are shared without a cap. That means that when spending increases as a result of rising drug prices, newly available treatments, or an enrollment surge during an economic downturn, the federal contribution automatically adjusts.
Do you have to get prior CMS approval for managed care?
Under the guidance, states would no longer be required to get prior CMS approval of managed care rates, contract amendments, or fee-for-service provider payment rates. They also may depart from the regulatory standards that currently govern network adequacy and access to care. CMS monitoring after the fact could, however, result in a state having to revise their policies at a later time.
How many states have not expanded Medicaid?
Only a few states would be expected at least initially to apply for the block grant and those would almost certainly be some of the 14 states that have not expanded Medicaid, said Matt Salo, executive director of the National Association of Medicaid Directors.
What is the new Medicare program?
The administration said the new program would allow states to offer patients more benefits while controlling government spending. But the plan was assailed by Democrats, consumer advocates and health providers as undermining efforts to serve the poor. States would not be required to switch to the new model.
Is Medicaid covered under a block grant?
The millions of low-income adults without children who obtained coverage under the ACA’s Medicaid expansion could be included under a block grant. Key Republicans, including officials in the Trump administration, have argued that covering those adults uses resources better geared toward other Medicaid enrollees whose medical needs are greater.
Is Medicaid a block grant?
The long-awaited guidance to states on turning Medicaid into a block grant allows the Trump administration to proclaim it’s transforming the Medicaid program and offers a way for states that haven’t expanded under the Affordable Care Act to move ahead. It could also tee up an election-year battle in which opponents will use the plan to argue ...
Does Medicaid cover prescription drugs?
States seeking the new authority would be able to make new cuts to benefits, including which prescription drugs are covered, and impose new out-of-pocket costs on enrollees. Medicaid traditionally has covered all federally approved prescription drugs. In June 2018, the Trump administration reinforced that position when it rejected a request ...
When will states get waivers?
Given that, it’s unlikely any state would get a waiver before 2021 — when there could be a change in federal administrations.
Who is the legal director of the National Health Law Program?
Only Congress is tasked with making these changes,” said Jane Perkins , legal director of the National Health Law Program, a legal aid group that has sued over the Trump administration’s approval of work requirements for many Medicaid enrollees in five states. It is evaluating litigation options on the block grants.
What Is A Block Grant?
Understanding Block Grants
- Block grants have been in use in some form since the 1950s. Most have supported social services, public health services, or community development programs. Block grants were designed to provide funding for those services with relatively few strings attached, allowing local governments to manage and oversee the programs. In addition, state and local governments may add their own guidelines and will sometimes distribute a portion of the grant t…
Criticism of Block Grants
- While block grants are intended to promote social good by helping states fund important programs, some have held critical views of these programs. Because the recipients of block grants have a great deal of flexibility in how those dollars are actually spent, opponents argue that federal money can be misused by local authorities. Money received from block grants often cannot be tracked or audited in the same way that categorical grants (intended …
Examples of Block Grants
- Three of the better-known block grant programs are earmarked for social services delivered at the local level: