Health and Human Services
States are experiencing significant reductions in federal funding for Medicaid and the Supplemental Nutrition Assistance Program (SNAP), as outlined in a budget resolution passed by the U.S. House of Representatives. These proposed cuts could amount to approximately $880 billion for Medicaid and $230 billion for SNAP over the next decade.
The following provides information so you can learn of the impacts to health and human services, and programs, including Public Health. It also provides how you can Take Action!
The following provides information so you can learn of the impacts to health and human services, and programs, including Public Health. It also provides how you can Take Action!
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Medicaid -ImpactsHere’s what you need to know about Medicaid.
Medicaid is a government funded health care program to provide access to medical, behavioral and supportive services for impoverished Americans. Beyond federal basic benefit standards, management, eligibility, and benefit extensions are issues relegated to the states. Because of their precarity Medicaid provides most of the medical, behavioral and social services, insofar as they are available, to most families involved in child abuse, family violence, substance use, mental illness and family dysfunction. Federal taxes fund a variable amount of the costs (at least 50% and up to 90%) based on the poverty level in each state. |
Medicaid covers about 72 million Americans and accounts for 20% of US healthcare spending.
Medicaid, funded by both states and the federal government, covers about 1 in 5 US adults and 40% of US children. It pays for 40% of US births and 60% of nursing home residents.
New York, Louisiana, and New Mexico have the highest percentage of Medicaid recipients; Utah, Wyoming, and North Dakota have the lowest. Patients may not know they are covered by Medicaid. In 27 states, Medicaid programs have other names, such as Medi-Cal in California.
Medicaid is the single largest payer for mental health services and substance use disorder services in the United States. In 2019 Medicaid paid for 24 percent of all spending on mental health services and about 24 percent of all spending on substance abuse treatment. Medicaid pays for vital services that people with mental health conditions rely on, such as medications, psychotherapy, intensive and inpatient treatment, peer support, and crisis care. Importantly, since 1965 Medicaid’s “Institution for Mental Diseases” (IMD) exclusion prejudiciously limits federal Medicaid funding to states for inpatient behavioral healthcare (i.e., mental health or substance use disorder [SUD]).This exclusion applies to care at facilities with more than 16 beds “primarily engaged in providing diagnosis, treatment, or care of persons with mental diseases, including medical attention, nursing care, and related services.”
Medicaid expansion under the ACA removed barriers for people with mental illness by allowing them to qualify based on income rather than a prior specific categorical illness/disability determination. Currently 40 states and DC have expanded Medicaid. This helps people get the mental health services they need, when they need them. Medicaid expansion under ACA covers an estimated 21 million people, and nearly 30% of people covered by Medicaid expansion have a mental health condition and/or a substance use disorder.
The financial impact of Medicaid cuts on providers will remain unclear until they are finalized. Uncompensated care costs will likely rise and patient revenue will decline. That’s especially true for community health centers, county medical and behavioral health services and safety-net hospitals and could cause them to reduce services, lay off staff, or close some sites. Medicaid patients made up about 17% of the average physician’s caseload in 2016, according to the AMA. But pediatricians, with the largest average Medicaid patient share of any specialty at nearly 35%, could see a bigger reimbursement hit, depending on whether they are on salary or not. Psychiatrists and emergency medicine physicians also have above average Medicaid patient shares (26% and 22%, respectively). Internists report the lowest Medicaid patient share at just under 12%. Medical training residency positions could be affected. Currently both Medicare and Medicaid fund graduate medical education, with the federal government matching a portion of what state Medicaid programs contribute toward residency programs.
Medicaid on average covers about 13.5% of US hospital patient days, but children’s, rural, and psychiatric hospitals typically have a much higher percentage of Medicaid patients and would be most affected by federal spending cuts.
For example, about 80% of patient days at Nemours Children’s Hospital in Orlando, Florida, are covered by Medicaid. Alaska has the highest Medicaid payor mix at nearly 30% followed by Virginia and Montana at 26.9% and 26.4%, respectively. Virginia is estimated to have a particularly high percentage of its population enrolled in Medicaid. Texas and Pennsylvania have the lowest percentage of Medicaid pay or mix, at less than 4% of hospital revenue on average. Since 60% of all nursing home patients are on Medicaid and there is no alternative to fund their care except state tax dollars, any cuts could be devastating to these facilities and stressful to state budgets.
Cost Cutting Measures Currently Debated
Currently the federal budget proposed by Republicans in Congress implies that $880 billion dollars should be saved over 10 years to help pay to continue tax cuts benefiting mostly wealthy families. It is clear that most of these cuts must come from Medicaid.
1. One target for Congressional Republicans is to cut the 90% state match given to participating states who expanded Medicaid eligibility under the ACA for savings of up to $1.9 trillion over 10 years. If those states ended the expansion, about 20 million enrollees— a quarter of all recipients — could lose coverage, according to an analysis by the Kaiser Family Foundation. Some states could choose to boost their spending to keep residents insured.
2. Republicans also have proposed a national work requirement for adult Medicaid recipients under age 65. Nearly two-thirds of recipients aged 19-64 are employed full or part time, with the rest working as caregivers or attending school, according to the Kaiser Family Foundation. Existing work requirement programs have shown they reduce enrollment due to enrollee confusion, official bureaucratic complexity and barriers, but do not increase employment rates.
3. Another option would provide block grants to states rather than keeping Medicaid as an open-ended entitlement. Over years as care costs rise, the capped match would not drastically reduce federal expenditures, while impairing access to care nationwide.
4. By reducing the federal match for state Medicaid spending, which now ranges from 77% to a mandated minimum of 50%, federal funds would be saved, but this would most adversely affect the poorest states.
Medicaid, funded by both states and the federal government, covers about 1 in 5 US adults and 40% of US children. It pays for 40% of US births and 60% of nursing home residents.
New York, Louisiana, and New Mexico have the highest percentage of Medicaid recipients; Utah, Wyoming, and North Dakota have the lowest. Patients may not know they are covered by Medicaid. In 27 states, Medicaid programs have other names, such as Medi-Cal in California.
Medicaid is the single largest payer for mental health services and substance use disorder services in the United States. In 2019 Medicaid paid for 24 percent of all spending on mental health services and about 24 percent of all spending on substance abuse treatment. Medicaid pays for vital services that people with mental health conditions rely on, such as medications, psychotherapy, intensive and inpatient treatment, peer support, and crisis care. Importantly, since 1965 Medicaid’s “Institution for Mental Diseases” (IMD) exclusion prejudiciously limits federal Medicaid funding to states for inpatient behavioral healthcare (i.e., mental health or substance use disorder [SUD]).This exclusion applies to care at facilities with more than 16 beds “primarily engaged in providing diagnosis, treatment, or care of persons with mental diseases, including medical attention, nursing care, and related services.”
Medicaid expansion under the ACA removed barriers for people with mental illness by allowing them to qualify based on income rather than a prior specific categorical illness/disability determination. Currently 40 states and DC have expanded Medicaid. This helps people get the mental health services they need, when they need them. Medicaid expansion under ACA covers an estimated 21 million people, and nearly 30% of people covered by Medicaid expansion have a mental health condition and/or a substance use disorder.
The financial impact of Medicaid cuts on providers will remain unclear until they are finalized. Uncompensated care costs will likely rise and patient revenue will decline. That’s especially true for community health centers, county medical and behavioral health services and safety-net hospitals and could cause them to reduce services, lay off staff, or close some sites. Medicaid patients made up about 17% of the average physician’s caseload in 2016, according to the AMA. But pediatricians, with the largest average Medicaid patient share of any specialty at nearly 35%, could see a bigger reimbursement hit, depending on whether they are on salary or not. Psychiatrists and emergency medicine physicians also have above average Medicaid patient shares (26% and 22%, respectively). Internists report the lowest Medicaid patient share at just under 12%. Medical training residency positions could be affected. Currently both Medicare and Medicaid fund graduate medical education, with the federal government matching a portion of what state Medicaid programs contribute toward residency programs.
Medicaid on average covers about 13.5% of US hospital patient days, but children’s, rural, and psychiatric hospitals typically have a much higher percentage of Medicaid patients and would be most affected by federal spending cuts.
For example, about 80% of patient days at Nemours Children’s Hospital in Orlando, Florida, are covered by Medicaid. Alaska has the highest Medicaid payor mix at nearly 30% followed by Virginia and Montana at 26.9% and 26.4%, respectively. Virginia is estimated to have a particularly high percentage of its population enrolled in Medicaid. Texas and Pennsylvania have the lowest percentage of Medicaid pay or mix, at less than 4% of hospital revenue on average. Since 60% of all nursing home patients are on Medicaid and there is no alternative to fund their care except state tax dollars, any cuts could be devastating to these facilities and stressful to state budgets.
Cost Cutting Measures Currently Debated
Currently the federal budget proposed by Republicans in Congress implies that $880 billion dollars should be saved over 10 years to help pay to continue tax cuts benefiting mostly wealthy families. It is clear that most of these cuts must come from Medicaid.
1. One target for Congressional Republicans is to cut the 90% state match given to participating states who expanded Medicaid eligibility under the ACA for savings of up to $1.9 trillion over 10 years. If those states ended the expansion, about 20 million enrollees— a quarter of all recipients — could lose coverage, according to an analysis by the Kaiser Family Foundation. Some states could choose to boost their spending to keep residents insured.
2. Republicans also have proposed a national work requirement for adult Medicaid recipients under age 65. Nearly two-thirds of recipients aged 19-64 are employed full or part time, with the rest working as caregivers or attending school, according to the Kaiser Family Foundation. Existing work requirement programs have shown they reduce enrollment due to enrollee confusion, official bureaucratic complexity and barriers, but do not increase employment rates.
3. Another option would provide block grants to states rather than keeping Medicaid as an open-ended entitlement. Over years as care costs rise, the capped match would not drastically reduce federal expenditures, while impairing access to care nationwide.
4. By reducing the federal match for state Medicaid spending, which now ranges from 77% to a mandated minimum of 50%, federal funds would be saved, but this would most adversely affect the poorest states.
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The Difference Between Medicaid and Medicare
Medicare and Medicaid are not the same thing; they are two distinct government programs in the United States that provide health coverage but serve different populations and have different eligibility requirements.
1. Medicare:
Primarily for individuals aged 65 and older, although it also covers certain younger individuals with disabilities or specific medical conditions (like End-Stage Renal Disease or ALS). It consists of different parts:
2. Medicaid:
1. Medicare:
Primarily for individuals aged 65 and older, although it also covers certain younger individuals with disabilities or specific medical conditions (like End-Stage Renal Disease or ALS). It consists of different parts:
- Part A covers hospital insurance.
- Part B covers medical insurance.
- Part C (Medicare Advantage) offers a combination of Part A and Part B through private insurers.
- Part D provides prescription drug coverage.
2. Medicaid:
- A state and federal program that provides health coverage for low-income individuals and families.
- Eligibility varies by state and may cover a broader range of populations, including low-income adults, children, pregnant women, elderly individuals, and those with disabilities.
- Medicaid can assist with a wider array of services, including long-term care, which Medicare does not typically cover.
What Can You Do?
Citizens are urged to contact their representatives in Congress to advocate for the protection of Medicaid, a vital program that covers approximately 72 million Americans and accounts for 20% of U.S. healthcare spending. Medicaid provides essential health services to about 1 in 5 adults and 40% of children in the country, playing a crucial role in financing 40% of U.S. births and supporting 60% of nursing home residents.
Importantly, Medicaid is the largest payer for mental health and substance use disorder services in the nation, funding critical care such as medications, therapy, and crisis support. The program's expansion under the Affordable Care Act (ACA) has significantly increased access to mental health services for many Americans, enabling millions to qualify based on income rather than a prior diagnosis. However, proposed budget cuts threaten to undermine these advancements, potentially leading to rising uncompensated care costs, reduced patient access to services, and devastating impacts on community health centers and hospitals that rely on Medicaid funding.
Additionally, current discussions in Congress about deep cuts to Medicaid funding, work requirements, and block grants could strip coverage from millions, particularly the most vulnerable populations. Such cuts not only threaten immediate access to healthcare but could also destabilize the healthcare system for children, rural communities, and individuals with mental health conditions.
Take Action! By reaching out to your representatives, you can make a difference by emphasizing the importance of preserving Medicaid funding to ensure that essential services remain available for those who need them most. Your voice matters—urge your Congress representative to stand up for Medicaid and protect the health and well-being of millions of Americans.
Importantly, Medicaid is the largest payer for mental health and substance use disorder services in the nation, funding critical care such as medications, therapy, and crisis support. The program's expansion under the Affordable Care Act (ACA) has significantly increased access to mental health services for many Americans, enabling millions to qualify based on income rather than a prior diagnosis. However, proposed budget cuts threaten to undermine these advancements, potentially leading to rising uncompensated care costs, reduced patient access to services, and devastating impacts on community health centers and hospitals that rely on Medicaid funding.
Additionally, current discussions in Congress about deep cuts to Medicaid funding, work requirements, and block grants could strip coverage from millions, particularly the most vulnerable populations. Such cuts not only threaten immediate access to healthcare but could also destabilize the healthcare system for children, rural communities, and individuals with mental health conditions.
Take Action! By reaching out to your representatives, you can make a difference by emphasizing the importance of preserving Medicaid funding to ensure that essential services remain available for those who need them most. Your voice matters—urge your Congress representative to stand up for Medicaid and protect the health and well-being of millions of Americans.
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You can also join and support efforts by PolicyLink is a nationally recognized research and advocacy organization dedicated to creating a future in which every individual in the United States can engage in a vibrant, multiracial democracy, succeed within an equitable economy, and reside in vibrant, opportunity-rich communities.
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References
- Medicaid and CHIP Overview, CMS, 2024 https://www.cms.gov/marketplace/technical-assistance-resources/medicaid-chip-overview.pdf
- Medicaid 101, Published: May 28, 2024, Kaiser Family Foundation https://www.kff.org/health-policy-101-medicaid/?entry=table-of-contents-introduction
- Can House Republicans Cut $880 Billion Without Slashing Medicaid? It’s Likely Impossible, KFF News, March 15, 2025 https://kffhealthnews.org/news/article/house-republican-budget-cuts-medicaid-billions/
