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Special Section: Protecting Medicaid

Blueprint of Public Policy Priorities for the 119th Congress, 2025-2026

Decorative Blue Bar

Congress and the White House have recently completed the first steps in the path to the end budget of a budget reconciliation process — expected to be finalized in April or May 2025— that will likely culminate in massive cuts to Medicaid, the Supplemental Nutrition Assistance Program (SNAP) and other social safety-net programs. The House Republicans' recent budget proposal has sparked significant controversy due to its plan to fund tax cuts for the wealthy by making substantial cuts to Medicaid. This proposal, endorsed by President Trump, aims to extend the 2017 Tax Cuts and Jobs Act (TCJA), which primarily benefits high-income earners. To offset the cost, the budget includes $880 billion in cuts to Medicaid, a program that provides essential health insurance for low-income American.

The Republican’s official proposed reconciliation budget includes recommended offsets to cover the between $4.5 $5.6 trillion (over ten years)in Trump tax cuts, and it’s clear that, no matter what the final reconciliation budget looks like when Congress votes on it in April or May 2025, it will achieve reconciliation by cutting a massive about of the Medicaid budget. In so doing, millions of vulnerable individuals and families will disproportionately suffer real and perhaps life altering harm. Broadly speaking, populations and services most directly and immediately impacted by the $880 billion budget cuts will include:

  • Older adults and individuals with disabilities: Cuts could target long-term services and supports (LTSS), such as personal assistance at home or nursing home care.
  • Low-income Families: Medicaid provides crucial health coverage for low-income families. Reductions in funding could lead to fewer benefits or stricter eligibility requirements, making it harder for these families to access necessary medical care.
  • Children: Low-income children will be affected by cuts to Medicaid and the Children's Health Insurance Program (CHIP). This could result in fewer children having access to essential healthcare services, including preventive care, vaccinations, and treatment for chronic conditions.
  • Healthcare and Behavioral Health Providers: Hospitals and community health centers that serve Medicaid patients could face financial strain due to reduced reimbursements. This might lead to cutbacks in services or even closures, particularly in underserved areas.
  • Behavioral health services and its professional workforce: The projected cuts will undoubtedly lead to workforce shortages and diminishing quality of care, with fewer people being able to access behavioral health services. Medicaid is also a major funder of behavioral health emergency services, including mobile crisis units. Cuts to Medicaid funding will reduce the availability of these critical services that prevent suicide attempts, prevent violent acts related to behavioral health crises, and supplants police responders to crisis with trained non-police crisis intervention specialists.
  • Long-Term Care: Medicaid is essential for millions of Americans— most of whom are older adults and individuals with disabilities - who receive Medicaid funded long-term care. Medicaid is a major payer for long-term care services in the United States. In 2020, total federal and state Medicaid spending was approximately $597.6 billion, with over 30% of this amount spent on long-term care services. Medicaid covers millions of Americans, including children, adults, and older adults, who need long-term care services due to disabling conditions and chronic illnesses. The coverage includes a range of services from institutional care, such as nursing homes, to community-based services like in-home personal care and adult day care. And it is not only care recipients who are impacted. As most middle-aged children of aging parents can attest to arranging for assisted living and nursing home care is unaffordable for not only low-income seniors, but for those with middle-class income, regardless of property or retirement income assets.
  • Health Disparities: Projected cuts to Medicaid funding and services are likely to significantly exacerbate existing health disparities. Medicaid is a crucial financial resource in the effort to reducing health disparities that affect low-income and vulnerable populations — with communities of color being especially at risk. Fewer people being eligible for coverage which means millions will lose access to essential health services. History tells us that this will disproportionately affect low-income families and communities of color.Reduced funding will inevitably force healthcare providers, especially those in underserved areas, to close or reduce services. This would limit access to care for many, particularly in rural and low-income urban areas.

Without Medicaid, many individuals would face higher out-of-pocket costs for healthcare, leading to financial strain and potentially causing them to forgo necessary medical treatments. This could lead to lack of access to preventive and primary care can lead to worsening health outcomes, including higher rates of chronic diseases and preventable hospitalizations. This would further widen the health disparities gap. Overall, the proposed cuts to Medicaid funding could have devastating effects on the health and well-being of millions of Americans, particularly those already facing significant health disparities.

Rural communities rely heavily on Medicaid, with about 20% of adults and 40% of children in these areas enrolled in Medicaid and CHIP. Cuts to Medicaid funding can disproportionately affect these communities. Overall, Medicaid cuts will severely impact the health and well-being of rural communities, making it harder for residents to access the care they need. Many rural hospitals already operate on thin margins, with about half running at a loss. Reductions in Medicaid funding could force these hospitals to reduce services or even close, limiting access to care for rural residents. Many rural areas are also remote, making it difficult for residents to travel to health care facilities. This isolation can lead to delays in receiving care and increased transportation costs. Rural areas often face a shortage of health care professionals, including doctors, nurses, and mental health providers. This shortage can result in longer waiting times for appointments and limited access to specialized care.Medicaid provides critical funding for various health services, including hospitals, clinics, community health centers, and long-term care facilities. Cuts could lead to a reduction or elimination of these essential services. Cuts could lead to a reduction or elimination of these essential services.

Work Requirements as a Barrier to Medicaid Eligibility

Work Requirements for retaining eligibility for entitlement services are not new. The following timeline is important to our update because it speaks directly to the link to such requirements and the Trump administration’s disdain for the Medicaid program:

  • Pre-2017: Medicaid eligibility was primarily based on income, with no work requirements.
  • 2017-2021: The Trump administration approved Section 1115 waivers allowing states to implement work requirements. However, many of these were struck down by courts or rescinded by the Biden administration.
  • 2021-Present: The Biden administration concluded that work requirements do not promote Medicaid's objectives and withdrew approvals for these waivers.

Currently, Republicans in Congress are giving serious considerations about imposing stringent work requirements for Medicaid eligibility. While those who favor work requirements often justify such measures touted as a means to promote self-sufficiency and reduce dependency on Medicaid, the real reason is that work requirements reduce Medicaid rolls by millions —thereby pointedly lowering the federal Medicaid budget.The concern about that logic is that work requirements have a sordid history of creating barriers to access to care, increases in health disparities, and greatly increases the number of uninsured individuals. According to the Kaiser Family Foundation (KFF), for example, there are several reasons why work requirements are more of a health care access barrier than a self-reliance motivation device for those in need of Medicaid support. These factors are:

  • They are unnecessary because among adults under age 65 receiving Medicaid,92% were already working full or part-time; or not working due to allowable reasons such as caregiving responsibilities, illness or disability, or school attendance.
  • Recent Congressional Budget Office (CBO) estimates national work requirements policies do in fact lower federal Medicaid spending. However, such requirements also increase the number of uninsured. For example,CBO estimated that if there were a national Medicaid work requirement, an average of 15 million enrollees would be subject to the requirements and, of that number, 1.5 million would lose eligibility for federal fundingIn that same analysis it was found that the policy would increase the number of people left without health insurance by as many 600,000 people.
  • Research suggests that Medicaid work requirements are confusing to enrollees. Lack of awareness and confusion about the requirements can be common. Also, there are report of vulnerable enrollees — such as people with disabilities and people experiencing homelessness— who were the most likely to face barriers in complying with the requirements.

The point is that these requirements fail to consider the complex realities faced by low-income individuals. Research consistently shows that work requirements do not significantly increase employment or earnings but instead create additional bureaucratic barriers that disproportionately harm vulnerable populations. By stripping essential benefits from those who need them most, work requirements exacerbate poverty and undermine the very goals of these programs—to provide a safety net and support for those in need. Therefore, it is crucial to advocate against such policies.

Conclusion

There is a near certainty that Medicaid’s budget allocation for the next ten years will be greatly reduced, and that the Trump administration and Congress will vote for a tax break for super-rich for as much as $5.6 trillion in tax breaks over a ten-year period.

The provider community, including social workers, must prepare to assist their clients/patients to function given the likelihood of unprecedented gaps in critical health and behavioral services, and the health care advocacy and health equity community must commit themselves to prolonged social actions and political mobilization to mitigate — and reverse—the impact of this attempt to shred the social safety-net. NASW is committed to prioritizing both these action steps to protect Medicaid the populations it serves.