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House Republicans Propose Cuts to Medicaid to Finance Savings

Client Alert
May 12, 2025

House Republicans released legislative language yesterday that highlights a key piece of their budget bill – cuts to the Medicaid entitlement program. The nonpartisan Congressional Budget Office (CBO) previously indicated that it would not be possible for House Republicans to achieve President Trump’s desired $880 billion in savings over 10 years without making substantial changes to Medicaid. That prediction came to fruition; the bill proposes Medicaid spending reductions to be achieved through policy changes that include more frequent eligibility verification, citizenship checks, tougher screenings of providers; and federal Medicaid funding cuts to states that offer coverage to residents living in the U.S. illegally.

The bill also seeks to impose work requirements for able-bodied adults aged 19 to 64 who do not have dependents, demanding they work at least 80 hours — or perform 80 hours of community service or other programs — per month. It includes exceptions for pregnant women. These requirements are more stringent than those included in Ohio’s Medicaid work requirements waiver that was recently submitted to the Federal government for approval. Ohio’s proposal applies to Medicaid expansion enrollees under age 55 who must be employed, be enrolled in school or a job training program, be in a recovery program, or have a serious physical or mental health illness to receive benefits.

These Federal Medicaid cuts threaten to force states to change how they finance their programs, to cut benefits, and/or to implement their own policy changes like adding cost-sharing requirements for beneficiaries in the program.

Following the release of the legislative language, the CBO issued a preliminary analysis finding that the health care portion of the bill would cut spending by $715 billion and would “reduce the number of people with health insurance by at least 8.6 million in 2034.”

For insights on how these Medicaid changes could affect you or your clients, contact BMD Member Daphne Kackloudis at dlkackloudis@bmdllc.com. 

MedicaidHealthcareHealthcare PolicyHealth LawDaphne Kackloudis
Client Alert

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