May 5 Update

In This Week’s Update:

  • National and State Level Modeling on Potential Medicaid Cuts
  • Impact of Expanding Federal Medicaid Work Requirements
  • Estimates of Proposed Medicaid Cuts
  • States of Innovation: April 2025
  • New HHS Report on Gender Affirming Care for Youth
  • Impact of Expanding Federal Medicaid Work Requirements
  • State updates: AL, CA, CO, DC, DE, FL, GA, IL, MA, MS, MT, NC, NJ, OR, PA, RI, VA, WA, WI & WY

 

National and State Level Modeling on Potential Medicaid Cuts
Last week, State Health and Value Strategies (SHVS) hosted a webinar highlighting a new toolkit, authored by Manatt Health with support and input from SHVS, that provides national and state-by-state modeling on the impact of potential Medicaid cuts. To support states as they use the toolkit, the webinar reviewed the components of the toolkit and discussed key proposals, including those to reduce the federal medical assistance percentage rate, establish a per-capita cap financial approach for enrolled Medicaid populations, and make work requirements a condition of Medicaid eligibility. The slide deck for the webinar is posted on our website and if you missed the webinar, you can watch a recording.

 

Estimates of Proposed Medicaid Cuts
Last week, SHVS updated its expert perspective tracking state estimates of proposed Medicaid cuts and the fiscal and enrollment impacts. The expert perspective now includes an interactive map and accompanying table, which can be filtered to display state analyses of proposals such as work requirements, per capita caps, changes to federal match, provider taxes, and state-directed payments. Updates follow.

 

States of Innovation: April 2025
SHVS published the latest post in our States of Innovation series. The series highlights what states are working on to achieve better, more affordable and more equitable health for all. This States of Innovation profiles state activity in April, which included states highlighting the value of Medicaid as Congress discusses potential federal cuts, reacting to federal policy, efforts to improve affordability, mental and behavioral health, and more.

 

New HHS Report on Gender Affirming Care for Youth
On May 1, the United States Department of Health and Human Services (HHS) released a report discussing the medical evidence on gender affirming care (GAC) for youth, as directed under the January 28 executive order. As expected, the report concludes that medical GAC services for youth “carry risk of significant harms including infertility/sterility, sexual dysfunction, impaired bone density accrual, adverse cognitive impacts, cardiovascular disease and metabolic disorders, psychiatric disorders, surgical complications, and regret. Meanwhile, systematic reviews of the evidence have revealed deep uncertainty about the purported benefits of these interventions.” As with most prior HHS announcements on GAC, this report does not compel any immediate action by states or GAC providers. Rather, it continues to build an administrative record, which HHS can cite in future actions that have real legal consequences, such as expressly banning Medicaid coverage of GAC for youth or amending the Conditions of Participation to exclude providers of youth GAC. For more information on the HHS report, see this Manatt Health analysis.

 

Impact of Expanding Federal Medicaid Work Requirements
Following previous analysis of a proposal to establish nationwide work requirements for adults ages 19 to 55 enrolled in Medicaid expansion, Urban researchers estimate in a new report coverage losses if the policy applied to expansion enrollees ages 19 to 64. The researchers find that if work requirements were extended to age 64, approximately 1 million additional adults—a total of 5.5 to 6.3 million expansion enrollees overall—would lose eligibility for federally funded Medicaid coverage in 2026, including many with significant health issues and healthcare needs.

 

State updates: AL, CA, CO, DC, DE, FL, GA, IL, MA, MS, MT, NC, NJ, OR, PA, RI, VA, WA, WI & WY

  • California – Insurance Commissioner Ricardo Lara issued a formal notice to all health insurers in the state to reaffirm the California Department of Insurance’s commitment to enforcing all state laws that protect consumers’ rights to equitable, accessible, culturally competent healthcare amid federal rollbacks. The notice reminds insurers that all state consumer protection laws remain in effect, including coverage and anti-discriminatory requirements for women, students, youth, immigrants, people of color, and the LGBTQIA+ community.
  • Colorado – Governor Jared Polis signed legislation expanding access to behavioral healthcare services for veterans and military-connected families. The bill expands the veterans’ mental health services program to provide grants to local nonprofit organizations to establish and expand community behavioral health programs.
  • Delaware – The Department of Health and Social Services (DHSS) released its fifth annual healthcare benchmark trend report, which showed a 9.1% increase in per capita total healthcare expenditures, outpacing the spending benchmark set at 3.1%. DHSS Cabinet Secretary Josette Manning described that, “A billion dollar increase in total healthcare expenditures in just one calendar year is significant, concerning, and unsustainable, especially in a time when states can no longer rely on federal healthcare funding. The Diamond State Hospital Cost Review Board will play a critical role in monitoring hospital expenses as we continue to work to ensure the greatest possible value in both cost and quality of care for the people of Delaware.”
  • District of Columbia – Mayor Muriel Bowser called on Congress to preserve the District’s federal medical assistance percentage (FMAP). Congress is considering a proposal to reduce D.C.’s FMAP from 70% to 50%, a change that would result in a $2.1 billion funding loss.
  • Georgia – Georgia submitted an application to extend the Georgia Pathways to Coverage demonstration which provides Medicaid coverage to low-income adults ages 19 through 64, who are not otherwise eligible for Medicaid coverage. As a condition of eligibility, applicants and enrollees must complete a minimum of 80 hours of qualifying activities, unless they require a reasonable accommodation due to a disability. The state is proposing to reduce the reporting requirement from monthly to annual, add qualifying activity types, add a retroactive coverage policy, remove the premiums and Member Rewards Accounts, and update copayments to align with the state Medicaid plan.
  • Illinois – The Illinois Department of Healthcare and Family Services held a presentation about the impact of Medicaid in the state and an analysis of what Illinois stands to lose if Congress implements cuts. The analysis looks at the estimated financial and enrollment impact of work requirements, per capita caps on federal spending, and a reduction in the federal match rate for the expansion population.
  • Massachusetts – The Healey-Driscoll administration announced that they have launched a two-year $25 million scholarship program for graduate students completing degrees or certificates in behavioral health fields.
  • Minnesota – Governor Tim Walz announced a new data dashboard Minnesotans can use to track disruptions and cancellations of federal funding and their impact on services available to Minnesotans. The dashboard is updated each weekday as funding disruptions and cancellations occur, as well as funding restored by court orders.
  • New Jersey
  • North Carolina – The North Carolina Department of Health and Human Services’ Division of Aging is partnering with North Carolina area agencies on aging and local service providers to distribute fans statewide to eligible recipients through the Operation Fan Heat Relief program. For more information on state efforts to mitigate the health impacts of extreme heat, see this Health Affairs Forefront article I wrote with my colleague Rebecca Lopez.
  • Oregon – The Oregon Health Authority published a data dashboard that offers transparency and insights into hospital and emergency department discharge data. The dashboard also reveals that Medicaid was the leading source of insurance for both hospital and emergency department patients covering 27% of hospital care and 39.3% of emergency care.
  • Pennsylvania – Governor Josh Shapiro announced a new, centralized consumer protection hotline, website, and email address to make it easier for Pennsylvanians to report scams and resolve financial and insurance issues. The initiative is intended to protect consumers and fill the void left by weakened federal consumer protections.
  • Rhode Island – Governor Dan McKee announced a series of strategic actions to strengthen Rhode Island’s primary care system: accelerating a primary care Medicaid rate review; requiring commercial health insurers to increase funding for primary care reimbursements; reducing red tape by easing prior authorization requirements; providing grants to help primary care practices serve additional patients and hire new providers; strengthening fiscal oversight of the healthcare system; and expanding the primary care student loan forgiveness program.
  • South Dakota – The state has begun a new initiative through a partnership with Emily’s Hope to offer free and anonymous naloxone distribution to South Dakotans. Placement of naloxone boxes will be aligned with the state’s data-driven naloxone saturation efforts, in collaboration with the South Dakota Department of Social Services and the South Dakota Department of Health, prioritizing locations statewide with higher rates of overdoses.
  • Virginia – Governor Glenn Youngkin announced that new data from the Virginia Department of Health, Office of the Chief Medical Examiner show fentanyl-related deaths in Virginia declined 44% year over year and are down over 46% from a peak in 2021.
  • Washington
    • The Washington Health Care Authority held a presentation about the impact of federal proposals on Medicaid in the state. The policies under consideration include work requirements, reducing the federal match rate for services and administration, reducing the use of state directed payments and provider taxes, and implementing a per capita cap of federal Medicaid funding.
    • Governor Bob Ferguson signed legislation that prohibits collection agencies and healthcare providers and facilities from reporting medical debt to consumer credit reporting agencies. As a reminder, SHVS has an expert perspective which tracks state efforts to cancel medical debt and prohibit medical debt reporting to credit agencies.
  • Wisconsin – The Wisconsin Department of Health Services published an analytic report modeling the impact of congressional budget cuts on Wisconsin Medicaid. The policies examined include work requirements, per capita caps on federal spending, and a reduction to the administrative and technology federal match.
  • Alabama, Florida, Georgia, Mississippi, Montana, Oregon, Washington, Wyoming – CMS approved amendments to five family planning section 1115 demonstrations to identify sexually transmitted infection (STI)/sexually transmitted disease (STD) screening as a family planning service and, for four demonstrations, STI/STD diagnosis services as a family planning-related service. The five demonstrations that had amendments approved are: Georgia Planning for Healthy Babies; Mississippi Family Planning; Montana Plan First; Oregon Contraceptive Care; and Wyoming Pregnant by Choice. Three family planning demonstrations, Alabama Plan First, Florida Medicaid Family Planning Waiver, and Washington Family Planning Only Program, had extensions approved.