Senior Director of State Fiscal Research
Federal budget negotiators are considering sizeable cuts to Medicaid as part of a deal to raise the debt limit, but some states are beating them to the punch.
Indeed, many states have cut Medicaid spending significantly in the last few weeks in their budgets for the new fiscal year, which started on July 1 in most states. These reductions come on the heels of widespread cuts that states enacted in their 2009, 2010, and 2011 budgets.
These state-level cuts save the federal government money as well (because the federal government shares Medicaid costs with the states), but they often come at a significant cost to low-income families and individuals. To cite just three examples: