As Congress considers cuts to Medicaid, advocates warn that proposals will hike state costs or reduce services for people with no other resources. (Getty Images)

Of the laundry list of proposed Medicaid cuts circulating on Capitol Hill, policy watchers say some stand out as the most likely to be implemented because they’ve either been tried before, frequently embraced, or both.

Advocates argue that none of the ideas will actually help the program do a better job of its central mission: make it possible for poor and low-income people to get either primary or long-term health care. Instead, they contend, the outcome would be to transfer the costs to states unwilling to cut services or kick people off the rolls who have no other health care resources.

Broad outlines of the proposed Medicaid wish list for Congressional Republicans were outlined in a U.S. House memo that Politico published in mid-January, along with 50 pages of details. The memo is the basis for a summary of those proposed cuts from policy analysts and advocates at the Georgetown University Center for Children and Families.

Among the proposals that have garnered the most attention and concern are:

• Instituting work requirements for Medicaid recipients.
• Capping the current federal contribution to a state’s Medicaid budget, also known as turning Medicaid funds into a state block grant.
• Lowering the federal government’s minimum share of the cost of Medicaid, currently 50%.
• Ending the increased federal government match for states that have adopted Medicaid expansion under the Affordable Care Act (ACA)

Additional proposals would make other changes to how the federal matching rate is calculated or applied and reverse several Biden administration rules that made Medicaid enrollment easier and broadened access to benefits, according to the Georgetown summary.

Medicaid is funded by a combination of federal and state money. Proposals that lower the federal share would require states to pick up a larger share of the cost to avoid reducing coverage.

“The scale of the cuts Congress is contemplating is so large it really will cause fiscal peril for the state,” says Tamara Jackson of the Wisconsin Board for People with Developmental Disabilities.

Medicaid work requirements

The congressional proposals include imposing work requirements for “able-bodied” people as a condition of receiving Medicaid.

The congressional memo specifies that work requirements would not include “pregnant women, primary caregivers of dependents, individuals with disabilities or health-related barriers to employment, and full-time students.” It pegs the savings from a work requirement at $100 billion over 10 years.

According to KFF, a nonpartisan, nonprofit health policy research organization, however, more than two-thirds of Medicaid recipients are working, and those who aren’t would largely fall into the groups the memo says would be exempt.

The first Trump administration approved state Medicaid program waivers that included work requirements, while the Biden administration withdrew its approval. Among them was a requirement in Wisconsin dating from the administration of former Gov. Scott Walker.

The GOP majority in the Wisconsin Legislature passed a bill in 2022 that included a Medicaid work-requirement variation, but it was vetoed by Gov. Tony Evers.

According to KFF, a Congressional Budget Office analysis of a 2023 U.S. House proposal to institute Medicaid work requirements found that while it would save the federal government $109 billion, it would also increase the number of uninsured people by 600,000 without increasing employment. An Arkansas work requirement instituted in 2018 but later found unlawful by a federal court led 18,000 people to lose coverage.

“What we know is, even though people are working or would be technically subject to exemptions, there are very significant administrative burdens on enrollees to prove that or be found ineligible,” says Richelle Andrae, associate director of government relations for the Wisconsin Primary Health Care Association. The organization represents federally qualified health centers that serve low-income patients, including those on BadgerCare Plus and those who are uninsured.

“More time-sensitive paperwork and steps that are hard for people to understand or do and lots of people trying to complete administrative tasks at the same time are a recipe for mistakes, by individuals and government agencies that must do the work,” says Jackson. “That is how policies like work requirements and more frequent eligibility checks save money. Eligible people lose coverage or struggle to get in.”

Block grants

Currently Medicaid pays states at least 50% of all Medicaid costs, with states paying the balance.

In President Donald Trump’s first term, his administration attempted to replace that long-standing guarantee with a block grant — a fixed amount of money per Medicaid beneficiary in the state, regardless of the actual cost.

That per-patient cap on federal funds “would instead radically restructure Medicaid financing,” according to the Georgetown summary.

The cost would be felt across the board, from long-term care in nursing homes or in the community home care to primary health care through BadgerCare Plus, health care providers say, to the detriment of patients.

“Whatever the proposals are that are at the federal level — changing the formula, [per-patient] caps, at the end of the day they they’re all aimed at reducing funding for the Medicaid program, and it really is a vital lifeline for long-term care services and support,” says Lisa Davison, executive director of LeadingAge Wisconsin. The organization represents nursing homes and assisted living providers in the nonprofit, publicly owned and for profit sectors.

Reducing support would send some patients who now have Medicaid coverage back into the pool of uninsured people, says Patricia Sarvela, chief development officer for Partnership Community Health Center, a federally qualified health center in the Fox Valley that serves uninsured people as well as BadgerCare recipients.

Lacking health insurance, people are likely to put off addressing symptoms until their condition worsens enough for them to go to the emergency room, Sarvela says.

Directly or indirectly, taxpayers will likely wind up having to cover the cost of that care, however. “There might be short-term federal savings but ultimately at the end of the day it’s going to cost the taxpayers a lot more because patients will then not have health insurance,” Sarvela says.

Changes to federal match

Several proposed changes relate to the amount of the federal Medicaid match or how it’s calculated.

A proposal published by the Paragon Institute in July 2024 calls for reducing the federal match below 50% of the costs. The Paragon Institute has close ties to the Heritage Foundation, which produced Project 2025, the 900-page document that, although disavowed by Trump last year, has been echoed in numerous actions since he took office.

In 10 states the federal match is at the minimum and would likely be lowered, the Georgetown summary says, adding: “These states would likely have to make deep cuts to their Medicaid programs in response.”

The states are California, Colorado, Connecticut, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Washington and Wyoming.

Other states receive a higher federal match; Wisconsin gets 60% of its costs covered. It’s not clear whether those states’ matches would also be reduced under the proposal or other Medicaid reduction proposals.

Medicaid expansion

Another likely cut would be to reduce the additional federal match for Medicaid recipients whose incomes are between 100% and 138% of the federal poverty line.

The additional match was included in the Affordable Care Act, enacted in 2010. Originally Medicaid expansion was mandatory under the act, but a subsequent U.S. Supreme Court ruling that upheld the ACA made Medicaid expansion voluntary.

States that have accepted the expansion got a 90% federal match for the added beneficiaries. The Congressional memo proposes ending the higher match, and some states that have expanded are already considering ending expansion if that happens.

Wisconsin never accepted Medicaid expansion, however, so that change would not directly affect the state. Although Evers first ran in 2018 on a vow to accept Medicaid expansion after Walker rejected it, he’s been blocked from doing so by the GOP majority in the Legislature.

As he has with every budget he’s proposed since taking office, Evers has included accepting Medicaid expansion in his 2025-27 budget proposal.

In an interview with the Wisconsin Examiner last month after a visit with constituents in Port Washington to promote his budget, Evers said he didn’t consider leaving out Medicaid expansion, despite predictions that it would be pulled back by Republicans.

“First of all, we don’t know if it’s going to go away,” Evers said. Under the current 90% match, he said, Wisconsin would get about $2 billion in additional federal money every two years and the additional people covered in the state “would get better health insurance, so it’s a win-win-win.”

Evers acknowledged that in the current Congress, there’s a risk for sharp reductions in Medicaid.

If that happens, “it would be disastrous,” Evers said. “We have lots of people on Medicaid in the state of Wisconsin.”

Among states, Wisconsin’s Medicaid profile is “pretty average,” he added.

“There are places in the country where Medicaid is a huge, huge player, and if they would get rid of Medicaid, our health care system would implode. There’s just no question about that. That’s the thing that concerns me.”

This story is Part Three in a series.

Read Part One: Wisconsin patients, families are wary as Congress prepares for Medicaid surgery

Read Part Two: How Medicaid fuels an economic engine for caregivers, family members and patients

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Republican state Rep. Jordan Redman speaks on the Idaho House floor in March 2024. This month, Redman reintroduced a bill that would repeal Medicaid expansion next year unless a set of strict conditions are met. Legislators in other states are also considering shrinking or eliminating Medicaid expansion. (Photo by Kyle Pfannenstiel/Idaho Capital Sun)

Republican lawmakers in several states have Medicaid expansion in their crosshairs, energized by President Donald Trump’s return to the White House and a GOP-controlled Congress set on reducing spending on the public health insurance program for low-income people.

As the feds consider cuts to Medicaid, some states are already moving to end or shrink their expanded Medicaid programs.

Legislators in Idaho have introduced a bill that would repeal voter-approved expansion, while Republicans in Montana are considering allowing their expanded program to expire. Some South Dakota lawmakers want to ask voters to let the state end expansion if federal aid declines. Nine other states already have trigger laws that will end their expansion programs if Congress cuts federal funding.

Meanwhile, discussions have stalled in non-expansion states such as Alabama, as lawmakers wait to see what the Trump administration will do.

Many conservatives argue that Medicaid expansion has created a heavy financial burden for states and that reliance on so much federal funding is risky. They argue that expansion shifts resources away from more vulnerable groups, such as children and the disabled, to low-income adults who could potentially get jobs.

In South Dakota, where voters approved Medicaid expansion in 2022 by a constitutional amendment, Republican state Sen. Casey Crabtree wants to bring expansion before voters again with a trigger measure. He told Stateline via text that his proposed amendment to the state constitution “empowers voters to maintain financial accountability, ensuring that if federal funding drops below the agreed 90%, the legislature can responsibly assess the state’s financial capacity and the impact on taxpayers while still honoring the will of the people.”

But even some Republicans are uneasy about what repealing expansion would mean for their constituents.

“Quite honestly, I have received hundreds of emails from constituents that have said, ‘please do not repeal.’ I have received zero asking me to repeal, which I think is very telling,” said Idaho state Rep. Lori McCann, a Republican who represents a swing district in the northern part of the state.

McCann said she’s interested in reining in Medicaid costs, but skeptical about a full expansion repeal. More than 89,000 Idahoans could lose their coverage if the state repeals its expansion, according to the latest numbers from the Idaho Department of Health and Welfare. McCann said she learned this month that only a fraction of those would qualify to buy discounted insurance on the state exchange.

“For the rest, what’s going to happen to them? They will utilize the emergency rooms again, and we’ll be back to the same problems we had prior to the Medicaid expansion.”

Before President Barack Obama signed the Affordable Care Act into law in 2010, traditional Medicaid insurance was mainly available to children and their caregivers, people with disabilities and pregnant women. But under the ACA’s Medicaid expansion program, states can extend coverage to adults making up to 138% of the federal poverty level — about $21,000 a year for a single person — and the federal government will cover 90% of the costs for those newly eligible enrollees. States kick in the rest.

All but 10 states, most of them controlled by Republicans, have taken the deal. Nationwide, more than 21 million people with low incomes get their health insurance because of expanded Medicaid eligibility.

(In Wisconsin, the state Legislature’s Republican majority has rejected repeated efforts since 2019 by Gov. Tony Evers and Democratic lawmakers to expand Medicaid, known as BadgerCare, in the state.)

But the Trump administration and a Republican-controlled Congress are seriously considering options for shrinking Medicaid as they look for ways to pay for extending tax cuts enacted during Trump’s first term in office. Proposals include reducing the federal 90% funding match, which could shift a greater chunk of Medicaid spending onto states, and greenlighting extra hurdles such as requiring enrollees to work in order to qualify for coverage.

Under Trump, many states might pursue Medicaid work requirements

The swirl of uncertainty at the federal level is supercharging efforts by Republican state lawmakers who have long opposed the program, despite its popularity.

In a public address last month, Arkansas Gov. Sarah Huckabee Sanders, a Republican, announced the state would ask the federal government for permission to institute work requirements for adults to qualify for coverage.

“If you want to receive free health care — paid for by your fellow taxpayer — able-bodied, working-age adults have to work, go to school, volunteer or be home to take care of their kids” she said.

Sanders argued coverage without such requirements discourages people from working and being self-sufficient.

But advocates and experts point to a wide body of research that links Medicaid expansion to lower uninsured rates, better health care outcomes and economic benefits for states, hospitals and other providers.

Without expansion, they say, many of the working poor who don’t have employer-sponsored insurance exist in a coverage gap: They don’t earn enough to afford private insurance, and yet they earn too much to qualify for traditional Medicaid. Expansion bridges that gap.

And, advocates argue, yanking health insurance from tens of thousands of people in a state would have far-reaching consequences for families, hospitals and state finances.

“It would be absolutely disastrous for everybody at all levels of the state,” said Idaho Democratic state Rep. Ilana Rubel, the House minority leader, who is on the committee considering bills that could repeal the state’s Medicaid expansion.

“We would go right back to people being unable to seek preventative care until it’s too late, back to loss of life, loss of health and financial catastrophe.”

A coordinated national effort

Many of the attempts to repeal Medicaid expansion in states such as Idaho and Montana are coordinated by national conservative-backed groups, said Joan Alker, executive director of Georgetown University’s Center for Children and Families.

“It’s important to understand this is part of a well-orchestrated and financed effort to undermine Medicaid generally, especially for adults,” said Alker, who is also a research professor at Georgetown’s McCourt School of Public Policy, where her work focuses on Medicaid and the Children’s Health Insurance Program.

Conservative-backed think tanks, including the Foundation for Government Accountability and the Paragon Health Institute, have testified before several state legislatures against Medicaid expansion and have worked to thwart state ballot initiatives.

In Montana, where Medicaid expansion is set to expire this year unless the legislature and governor opt to renew it, representatives from the foundation and the institute urged state lawmakers to scrap Medicaid expansion. Montana Republican state Rep. Jane Gillette, a dentist, appeared in a video produced by the foundation advocating for the state to allow its expansion to expire.

Neither organization responded to interview requests.

In Idaho last year, state Rep. Jordan Redman, a Republican, ceded most of his time introducing his Medicaid bill to a representative from the Foundation for Government Accountability. That bill later failed to advance out of committee after intense public pushback.

‘Repeal in sheep’s clothing’

This month, Redman revived his Medicaid bill. It would repeal Medicaid expansion next year if the federal government does not maintain the 90% match and the state does not receive federal permission to enact work requirements and a host of other new restrictions, including a 50,000 cap on expansion enrollment — just over half of its current enrollment — and a three-year limit on receiving benefits.

“This safeguard approach will strengthen Idaho’s Medicaid program while maintaining flexibility,” Redman told the Idaho House Health & Welfare Committee earlier this month. “If the federal government or state agencies fail to meet the program’s safeguards, this legislation ensures those Medicaid dollars will be redirected to serve the truly needy.” Redman did not respond to an interview request from Stateline.

Rubel, the Democratic leader, described Redman’s bill as “Medicaid repeal in sheep’s clothing.”

“It’s a type of trigger law with incredibly unlikely-to-be-met conditions,” she said. “Basically, they’re saying unless you can fly a unicorn to the moon and back, Medicaid expansion will be repealed.”

Idaho voters approved Medicaid expansion by ballot measure in 2018, with nearly 61% in favor. The law took effect in 2020.

Conservative lawmakers in Idaho have tried without success to repeal Medicaid expansion ever since, including introducing another repeal bill last month. But this could be conservatives’ year. Before the session, Idaho’s Republican House speaker expanded the committee from 13 seats to 15. It’s a move that some state Democrats say was an effort to ram through Medicaid expansion repeal. At least eight committee members have pledged support for the Idaho Republican Party’s platform, which calls for repeal of Medicaid expansion.

Medicaid is popular nationally, in expansion and non-expansion states. Three-fourths of Americans have a favorable view of Medicaid, according to a January 2025 health tracking poll from KFF, a health research organization. It’s a preference that crosses political boundaries: 63% of Republicans, 81% of independents and 87% of Democrats view it favorably.

Polling in Idaho in 2023 found 75% of voters — including 69% of Republican voters — held a favorable view of Medicaid.

“Citizens should not have to work this hard to get something passed that they want and need so desperately, and then keep imploring legislators not to take it away again,” said Rubel.

Trigger laws

If Congress reduces the 90% federal match rate for Medicaid expansion, more than 3 million adults could immediately lose their health coverage.

That’s because nine states have so-called trigger laws that would automatically end Medicaid expansion if federal funding is cut: Arizona, Arkansas, Illinois, Indiana, Montana, New Hampshire, North Carolina, Utah and Virginia. Three additional states — Iowa, Idaho and New Mexico — would require the government to take cost-saving steps to ease the financial impact of federal cuts.

Alker is skeptical that Congress would be able to get such legislation passed before most state legislative sessions end this spring. But if cuts are made, the impacts could start showing up in 2026.

Regardless of possible cuts at the federal level, states including Arkansas and Idaho are looking at ways to reduce the number of Medicaid-eligible people by instituting work requirements or benefit caps.

States need federal approval to impose such additional conditions on Medicaid eligibility.

The first Trump administration approved work requirements in 13 states, but the courts later struck those down and the Biden administration rejected such requests. States, including Arkansas, are trying again, hoping they’re more likely to get what they want under the new Trump administration.

Redman told Idaho legislators that he expects the Trump administration to grant the waivers that would be needed under his proposed bill.

“I actually spoke to several folks at the new federal administration, and they said they’re looking for waivers that are unique and creative, that they want to grant,” he said.

Meanwhile, Republican lawmakers in non-expansion states have in recent years warmed to the idea of expansion. It was arguably the biggest issue of last year’s legislative session in solidly red Mississippi, and was backed by Republican Lt. Gov. Delbert Hosemann. Expansion is back on the table this year, though lawmakers have said they won’t consider a plan unless it includes work requirements.

But in Alabama last month, House Speaker Nathaniel Ledbetter, a Republican, said expansion would no longer be a priority this session because Medicaid was likely to see changes at the federal level.

“I think we are better off seeing what they are going to do,” he told reporters.

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org.

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U.S. President-elect Donald Trump speaks at a news conference at Trump's Mar-a-Lago resort on Dec. 16, 2024 in Palm Beach, Florida. (Photo by Andrew Harnik/Getty Images)

Under President Joe Biden, enrollment in Medicaid hit a record high and the uninsured rate reached a record low.

Donald Trump’s return to the White House — along with a GOP-controlled Senate and House of Representatives — is expected to change that.

Republicans in Washington say they plan to use funding cuts and regulatory changes to dramatically shrink Medicaid, the nearly $900-billion-a-year government health insurance program that, along with the related Children’s Health Insurance Program, serves about 79 million mostly low-income or disabled Americans.

The proposals include rolling back the Affordable Care Act’s expansion of Medicaid, which over the last 11 years added about 20 million low-income adults to its rolls. Trump has said he wants to drastically cut government spending, which may be necessary for Republicans to extend 2017 tax cuts that expire at the end of this year.

Trump made little mention of Medicaid during the 2024 campaign. The first Trump administration approved work requirements in several states, though only Arkansas implemented theirs before a federal judge said it violated the law. The first Trump administration also sought to block-grant funding to states.

House Budget Committee Chair Jodey Arrington (R-Texas) told KFF Health News that Medicaid and other federal entitlement programs need major changes to help cut the federal debt. “Without them, we will watch this country sadly enter into fiscal collapse.”

Rep. Chip Roy (R-Texas), a member of the Budget Committee, said Congress needs to explore cutting federal spending on Medicaid.

“You need wholesale reform on the health care front, which can include undoing a lot of the damage being done by the ACA and Obamacare,” Roy said. “Frankly, we could end up providing better service if we do it the right way.”

Advocates for poor people fear GOP funding cuts will leave more Americans without insurance, making it harder for them to get care.

“Medicaid is an obvious target for huge cuts,” said Joan Alker, executive director of Georgetown University’s Center for Children and Families. “An existential fight about Medicaid’s future likely lies ahead.”

Medicaid, which turns 60 in July, is nearing the end of a disruptive period, after covid pandemic-era coverage protections expired in 2023 and all enrollees had to prove they still qualified. More than 25 million people lost coverage over the 18 months after the “unwinding” began, though it has not notably increased the number of people without insurance, according to the latest census data.

The unwinding’s disruptions could pale in comparison to what happens in the next four years, said Matt Salo, former executive director and founder of the National Association of Medicaid Directors. “What we are going to see is an even bigger seismic shift in who Medicaid covers and how it operates,” he said.

But Salo said any efforts to shrink the program will face pushback.

“A lot of powerful entities — state governments, managed-care organizations, long-term care providers, and everyone under the sun who wants to do well by doing good — wants to see Medicaid work efficiently and be adequately funded,” he said. “And they will be highly motivated to push back on something they see as draconian cuts, because it could affect their business model.”

The GOP is looking at several tactics to reduce the size of Medicaid:

• Shifting to block grants. Switching to annual block grants could lower federal funding for states to operate the program while giving states more discretion over how to spend the money. Currently, the government matches a certain percentage of state spending each year with no cap. Republican presidents since Ronald Reagan have sought to block-grant Medicaid with no success. Arrington said he favors ending the open-ended federal funding to states and replacing it with a set annual amount based on how many people each state has in the program.
• Cutting ACA Medicaid funding. The ACA provided financing to cover, through Medicaid, Americans with incomes up to 138% of the federal poverty level, or $20,783 for an individual last year. The federal government pays 90% of the cost for adults covered through the law’s Medicaid expansion, which 40 states and Washington, D.C., have adopted. The GOP may try to lower that funding to the same match rate the feds pay states for everyone else in the program, which averages about 60%. “We should absolutely note that we are subsidizing the healthy, able-bodied Medicaid expansion population at a higher rate than we do the poorest and sickest among us, which was the original intent of the program,” Arrington said. “That’s not right.”
• Lowering federal matching funds. Since Medicaid began, the federal match rate has been based on the relative wealth of a state’s population, with poorer states receiving a higher rate and no state receiving less than a 50% match. Ten states get the base rate — all but two are Democratic-run states, including New York and California. The GOP may seek to cut the base rate to 40% or less.
• Adding work requirements. During the first Trump term, federal courts ruled that Medicaid law doesn’t allow coverage to be conditioned on enrollees’ working or seeking jobs. But the GOP may try again. “If we can get strict work requirements on able-bodied adults, that can be a huge cost savings by itself,” Rep. Tom McClintock (R-Calif.) told KFF Health News. Because most Medicaid enrollees already work, go to school, or serve as caregivers, critics say such a requirement would simply add red tape to obtaining coverage, with little impact on employment.
• Placing enrollment hurdles. About 10 states offer some populations what’s called continuous eligibility, whereby people stay enrolled for years without having to renew their coverage. That policy’s been shown to prevent enrollees from falling out of the program for short periods because of hardships or paperwork problems, which can lead to surprise medical bills and debt. The Trump administration could seek to repeal waivers that allow states to grant multiyear continuous eligibility, which would require people in those states to reapply for coverage annually.

If the GOP’s plans to shrink Medicaid are realized, Democrats and health experts say, low-income people forced to buy private insurance would face challenges paying monthly premiums and the large copayments and deductibles common to commercial plans that typically don’t exist in Medicaid.

The Paragon Health Institute, a leading conservative think tank run by former Trump adviser Brian Blase, has issued reports saying the billions in extra money states took to expand Medicaid under the ACA has been a boon to private insurers that manage the program and relatively wealthier people it says shouldn’t be enrolled.

Josh Archambault, a senior fellow with the conservative Cicero Institute, said he hopes the Trump administration holds states accountable for overpaying providers and enrolling people in Medicaid who are not eligible. Conservatives have cited CMS reports saying states improperly pay Medicaid providers billions of dollars a year, though the federal government notes that is mostly due to lack of documentation.

He said the GOP will look to scale back Medicaid to its “traditional” populations of children, pregnant women, and people with disabilities. “We need to rebalance the program that most people think is underperforming,” he said. Most Americans, including large majorities of both Republicans and Democrats, view the program favorably, according to polls.

KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.

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This article first appeared on KFF Health News and is republished here under a Creative Commons license.