Michigan Gov. Gretchen Whitmer signs an executive directive instructing the Michigan Department of Health and Human Services to analyze the ways federal cuts to Medicaid would impact Michigan. | Kyle Davidson

The House Budget Committee has proposed substantial reductions in federal Medicaid spending as part of a broader effort to reduce the federal deficit.

A 2017 report from the Congressional Budget Office and the Joint Committee on Taxation states estimated in 2018, 15 million more people would be uninsured under this legislation than under current law. The increase in the number of uninsured people relative to the number under current law would reach 19 million in 2020 and 22 million in 2026. In 2026, an estimated 82 percent of all U.S. residents under age 65 would be insured, compared with 90 percent under current law.

In January, the Center on Budget and Policy Priorities reported these proposals would dramatically change Medicaid’s funding structure, deeply cut federal funding, and shift costs and financial risks to states. Faced with large and growing reductions in federal funding, states would cut eligibility and benefits, leaving millions of people without health coverage and access to needed care.

These proposals would dramatically change Medicaid’s funding structure, deeply cut federal funding, and shift costs and financial risks to states. Faced with large and growing reductions in federal funding, states would cut eligibility and benefits, leaving millions of people without health coverage and access to needed care.

In Michigan, where the vast majority of Medicaid funds come from the federal government. The state would have to figure out how to reduce services, trim people from the program orr backfill the cuts with millions of dollars from other programs — public safety and infrastructure, for example, Bridge Michigan reported on May 1.

On April 28, the Lansing State Journal reported Medicaid is the backbone of Michigan’s health care system. More than 2.6 million people in our state depend on Medicaid for essential care — including more than 1 million children, seniors who need long-term services, people with disabilities seeking independence and working families struggling to afford private insurance.

Medicaid covers a wide range of services, from basic checkups to cancer treatments and lifesaving medications, the Journal reported. Nearly half of all children in Michigan are covered by Medicaid, and in 2024, 45% of all babies born here relied on the program. In many rural counties, Medicaid covers the majority of births, making it crucial for keeping birthing services open in those communities.

Beyond basic health care, Medicaid also plays a critical role in behavioral health and substance use treatment, especially in rural and underserved areas, says the Journal.

In Michigan, 19 percent of Medicaid enrollees are older adults and individuals with disabilities. For those with intellectual and developmental disabilities (ID/DD), Medicaid is not just a safety net, but a vital source of access to essential long term care services, Sarah Benson, executive director of the Arc Northern Michigan, said.

“Individuals with disabilities disproportionately rely on Medicaid coverage and benefits because many of them live on fixed incomes and face barriers to employment and access to private health coverage,” Benson wrote in an open letter. “They are also more likely to use long term care, of which Medicaid is the primary payer.”

And while the personal health benefits are obvious, Medicaid is also a powerful economic engine. The program supports more than $24 billion in annual health care services in Michigan, with more than three-quarters of funding coming from the federal government. Medicaid expansion alone has brought more than $1 billion in federal funds to our state and supports more than 10,000 jobs in our communities.

Melissa Samuel, president of the Health Care Association of Michigan, said currently it is not known how extensive the cuts will be, but any cut, particularly for long-term care and nursing facilities is going to have an impact throughout the state of Michigan. Of approximately 28 nursing facilities throughout the Upper Peninsula, Samuel said, including county facilities, all would be impacted.

“We have a high percentage of residents in (long-term care), our payer sources – Medicaid is 66%, while 18% of residents are covered under Medicare, and the remaining are private pay,” Samuel said. “Far and away, long-term care and skilled nursing facilities are the largest provider for those covered by Medicaid assistance.”

If these cuts happen, the Journal states, impossible choices must be made. Access to care would shrink, costs would shift onto state budgets and local providers, and coverage for seniors, children, veterans, people with disabilities and working families would be at risk. Samuel agrees.

“When we talk about a potential (financial) cut to skilled nursing facilities, it immediately is going to impact the workforce. 75% or more of the reimbursement to medical facilities goes directly into labor, so it is the wages and benefits of the employees in these settings.”