This article addresses the policy issues and outcomes associated with the block grant option in long-term care (LTC). Block grants are being considered in a number of human service areas currently, especially in the wake of the 1980 elections. The article assumes that Medicaid and other LTC-related policies would be consolidated in a formula-based, capped block grant. The potential advantages are in the areas of responsiveness, coordination and institution-building at the state level. Potential problems include new organizational demands on the designated LTC state agency; political dislocations caused by disaffected agency and provider groups; and unequal competition for LTC resources resulting from the removal of legislative safeguards and hierarchical support. The article concludes on the note that proponents of the block grant option have not addressed a number of the major shortcomings that may accompany an LTC block grant.