CHICAGO — Lawmakers on Capitol Hill will discuss cuts to Medicaid tomorrow, during a reconciliation mark-up in the House Energy and Commerce Committee. The mark-up comes as data continues to emerge highlighting just how devastating cuts would be – both for state budgets and taxpayers; as well as for the tens of millions of Americans who access healthcare through the program. A report out last week from the non-partisan Congressional Budget Office (CBO) estimates anywhere from 2.3 million to 8.6 million Americans could lose Medicaid coverage under various proposals lawmakers are currently considering. The CBO figures come days after the Institute for Responsive Government released a report detailing specific impacts cuts would have on state budgets, as well as warnings from former state health officials. 

The report, Unbalanced Ledger: Why States Can’t Afford Deep Medicaid Cuts, draws on Responsive Gov’s expertise in government efficiency and administration; and explores how Medicaid cuts would decrease the program’s efficiency and hinder modernization efforts; undermine ongoing initiatives to combat waste, fraud, and abuse; and stick taxpayers with the bill as states scramble to cover newly uncompensated care, job loss, and growing reliance on public benefit programs.  Analysis was grounded in insights from state officials and practitioners with experience administering and funding the Medicaid program, gathered in interviews conducted by Responsive Gov in March 2025. Insights from these officials include:

“Cutting Medicaid would have a cascading effect. We are always trying to create jobs in these [rural] communities, like dairy farms and other low wage jobs, but the health sector jobs are middle class jobs that drive the economy. If we get rid of these health care jobs, we get rid of these last good jobs in the community and gut the entire economic wellbeing of the community. Health care jobs keep the Piggly Wiggly open.”

Marcus Cheatham, retired Health Officer from Central Michigan

“If a state Medicaid department loses funds for admin or loses agency staff, it raises the specter that you increase the likelihood for errors or even fraud.”

Joe Flores, Former Virginia Secretary of Finance

“I’d drop training. Anything I do to train staff or people in the community, gone. Oversight of programs would have to be reduced and we would not be able to focus on program quality. Our response to legislative correspondence would be really slow. Coordination with other agencies, like public health departments or the department of justice, which saves the state tons of money overall, would be gone. There would generally be slower and less efficient implementation of new policies.”

Jim Jones, former Wisconsin Medicaid Director

“We would be required to disenroll current Medicaid recipients if the 90 percent federal matching rate for the expansion group went down by even a percentage point because we have a trigger law. Will the newly uninsured go back to Virginia Commonwealth University and University of Virginia hospitals for uncompensated care? That’s going to cost them millions. You might be talking close to $300M a year, based on actual costs projected forward from more than a decade ago.”

Joe Flores, Former Virginia Secretary of Finance

The new report is the latest resource from Responsive Gov on the importance of maintaining federal funding for Medicaid. Earlier this year, Responsive Gov released an analysis exploring how cross-sector innovation – such as utilizing learnings from election technology – could help cut costs and improve efficiency within the Medicaid program.

To speak with Sam Oliker-Friedland or other Responsive Gov policy experts about threats to Medicaid funding, please contact dan@responsivegov.org. 

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The Institute for Responsive Government is a nonpartisan nonprofit dedicated to ensuring state and federal governments work effectively for the very people they serve. The Institute for Responsive Government provides data, research, and expertise to elected officials in order to find practical policy solutions that make government systems more efficient, accessible, and responsive.