House Republicans are proposing nearly $1 trillion in cuts to Medicaid and food stamps. The proposed cuts have sparked concern among experts who warn that the reductions would affect a wide range of Americans, including children, people with disabilities, and senior citizens. More than 71 million people are enrolled in Medicaid, and roughly 42 million Americans receive food stamps, also known as the Supplemental Nutrition Assistance Program (SNAP).
The financial impact of the Medicaid cuts could also affect hospitals, potentially leading to higher rates for those with job-based insurance and possibly causing some hospitals to shut down. States would face the challenge of covering a larger share of the costs, which could force them to cut enrollment or benefits in Medicaid, and reduce access to food stamps. They might also have to make cuts to other state-supported services or increase taxes.
“We’ve never in history experienced coverage cuts of this size, and that makes it really difficult to predict how states, providers, and patients will respond,” said Alice Burns, an associate director of the Program on Medicaid and the Uninsured at KFF, a nonpartisan health policy think tank. The House GOP package aims to reduce federal support for Medicaid by nearly $700 billion over a decade. This reduction could strip Medicaid coverage from more than 10 million people over the next 10 years.
An additional 7.6 million Americans could be uninsured by 2034 due to these provisions. One of the most significant proposals in the package is the introduction of work requirements for Medicaid recipients. Certain recipients aged 19 to 64 would need to work at least 80 hours a month to retain their benefits, a mandate that would start in 2029.
Exceptions would exist for parents, pregnant women, medically frail individuals, and those with substance-abuse disorders.
House GOP spending cuts impact millions
However, experts warn that many could still lose coverage due to the complexities of reporting work hours or applying for exemptions.
Michael Karpman, a principal research associate at the Urban Institute, commented, “We expect that millions of adults will lose coverage under work requirements, including many who are working, who are looking for a job, who are unable to work because of a health condition or disability, or who are meeting some other qualifying activity, but just don’t successfully report it because they have difficulty dealing with the bureaucracy of the new work reporting system.”
The legislation would also restrict states’ ability to levy taxes on healthcare providers, impacting efforts to fund health-related initiatives. As more people become uninsured, hospitals could see higher uncompensated care costs. For those who are eligible for both Medicare and Medicaid, the changes could be particularly harsh.
A provision to delay the implementation of a rule aimed at streamlining Medicaid eligibility could result in 2.3 million people losing coverage, including senior citizens, people with disabilities, and children. States would need to figure out how to deal with the loss of federal funding. Medicaid represents the largest source of federal funding for state budgets and the second largest state expenditure after K-12 education.
States might reduce optional benefits, such as dental care and physical therapy, or raise taxes. The GOP package also includes changes to food stamps. Adults aged 18 to 54 without dependent children currently must work 20 hours a week or qualify for an exemption to receive food stamps for more than three months in a 36-month period.
The new legislation would extend these work requirements. The impact of these proposed cuts will be closely watched as the legislation moves through the House and Senate. The final outcome remains uncertain as lawmakers continue to negotiate changes to the provisions.