The way it works currently, everyone who qualifies is guaranteed coverage and states and the federal government combine funds to cover the costs.
When they turn it into a block grant, they basically say "Ok we're giving you X amount per capita to spend as you wish." The increase of the block grant each year is also tied to something with slower growth than costs will actually be. Since it's not open ended anymore, states wouldnt necessarily get more money to compensate if, say, more people qualified for Medicaid because of an economic downturn. Also, if an expensive new drug entered the market, or a costly new disease emerged, the Medicaid budgets still wouldnt change to reflect that.