Medicaid at Risk: Over 3 Million Americans Could Lose Coverage if Trump Cuts Federal Funding

More than 3 million Americans may lose their Medicaid health coverage under  the Affordable Care Act (ACA) if federal funding is reduced during President-elect  Donald Trump’s second term. Nine states, governed by automatic trigger laws, would see immediate Medicaid expansion rollbacks, leaving millions of low-income individuals without access to essential health care.

The Potential Impact of Medicaid Cuts

Medicaid, a lifeline for the poorest children and adults in the U.S., provides nearly free health care coverage, while Medicare serves older Americans and the disabled. Under the ACA, also known as Obamacare, Medicaid was expanded to cover millions of uninsured, low-income individuals, with the federal government covering 90% of the associated costs.

However, in states with trigger laws, Medicaid expansion would be automatically reduced if federal funding falls below the 90% threshold. According to the Kaiser Family Foundation (KFF) and Georgetown University’s Center for Children and Families, these cuts would primarily affect nine states:

  • Arizona
  • Arkansas
  • Illinois
  • Indiana
  • Montana
  • New Hampshire
  • North Carolina
  • Utah
  • Virginia

Arizona’s trigger law is even more stringent, requiring federal contributions to remain above 80%.

Millions at Risk

Across these nine states, researchers estimate that between 3.1 million and 3.7 million people would lose Medicaid coverage if federal funding drops below the trigger thresholds.

While 40 states initially expanded Medicaid under the ACA, any reduction in federal support would force state legislatures to decide whether to make up the difference or scale back coverage. According to Renuka Tipirneni, an associate professor at the University of Michigan, state-level politics will play a significant role in determining how these changes unfold.

Political Landscape

Six of the nine states with trigger laws—Arizona, Arkansas, Indiana, Montana, North Carolina, and Utah—voted for Trump in the 2024 election, adding complexity to the political calculus surrounding potential Medicaid cuts.

In his first term, Trump sought to repeal the ACA but later indicated he would retain the program while introducing unspecified changes. His plans for Medicaid remain unclear, though cutting federal spending is one of his administration’s stated goals.

Adding to the uncertainty, Trump has tapped Dr. Mehmet Oz, a celebrity heart surgeon and former talk show host, to head the Centers for Medicare and Medicaid Services. Oz’s leadership could signal significant shifts in Medicaid policy, though specific details have not been outlined.

The Future of Medicaid Expansion

If Congress reduces Medicaid funding, all 40 states that opted into the program would face challenges, even those without trigger laws. Legislatures would need to either allocate additional funds or roll back coverage, leaving millions at risk.

With health care access hanging in the balance, the debate over Medicaid funding is set to become a key issue during Trump’s second term. The fate of millions of Americans’ health coverage will likely hinge on the decisions made at both federal and state levels.

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