The prospect of sweeping federal cuts to Medicaid is alarming to some Missourians who remember the last time the public medical insurance program for those with low incomes or disabilities was pressed for cash in the state.
In 2005, Missouri adopted some of the strictest eligibility standards in the nation, reduced benefits, and increased patients’ copayments for the joint federal-state program due to state budget shortfalls totaling about $2.4 billion over several prior years. More than 100,000 Missourians lost coverage as a result, and the Federal Reserve Bank of Philadelphia reported that the changes led to increases in credit card borrowing and debt in third-party collections.
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A woman told NPR that year that her $6.70-an-hour McDonald’s job put her over the new income limits and rendered her ineligible, even though she was supporting three children on about $300 a week. A woman receiving $865 a month in disability payments worried at a town hall meeting about not being able to raise her orphaned granddaughter as the state asked her to pay $167 a month to keep her health coverage.
Now, Missouri could lose an estimated $2 billion a year in federal funding as congressional Republicans look to cut at least $880 billion over a decade from a pool of funding that includes Medicaid programs nationwide. Medicaid and the closely related Children’s Health Insurance Program together insure roughly 79 million people — about 1 in 5 Americans.
“We’re looking at a much more significant impact with the loss of federal funds even than what 2005 was,” said Amy Blouin, president of the progressive Missouri Budget Project think tank. “We’re not going to be able to protect kids. We’re not going to be able to protect people with disabilities from some sort of impact.”
At today’s spending levels, a cut of $880 billion to Medicaid could lead to states’ losing federal funding ranging from $78 million a year in Wyoming to $13 billion a year in California, according to an analysis from KFF, a health information nonprofit that includes KFF Health News. State lawmakers nationwide would then be left to address the shortfalls, likely through some combination of slashing benefits or eligibility, raising taxes, or finding a different large budget item to cut, such as education spending.
Republican lawmakers are floating various proposals to cut Medicaid, including one to reduce the money the federal government sends to states to help cover adults who gained access to the program under the Affordable Care Act’s provision known as Medicaid expansion. The 2010 healthcare law allowed states to expand Medicaid eligibility to cover more adults with low incomes. The federal government is picking up 90% of the tab for that group. About 20 million people nationwide are now covered through that expansion.
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Missouri expanded Medicaid in 2021. That has meant that a single working-age adult in Missouri can now earn up to $21,597 a year and qualify for coverage, whereas before, nondisabled adults without children couldn’t get Medicaid coverage. That portion of the program now covers over 329,000 Missourians, more than a quarter of the state’s Medicaid recipients.
For every percentage point that the federal portion of the funding for that group decreases, Missouri’s Medicaid director estimated, the state could lose $30 million to $35 million a year.
But the equation is even more complicated given that Missouri expanded access via a constitutional amendment. Voters approved the expansion in 2020 after the state’s Republican leadership resisted doing so for a decade. That means changes to Medicaid expansion in Missouri would require voters to amend the state constitution again. The same is true in South Dakota and Oklahoma.
So even if Congress attempted to narrowly target cuts to the nation’s Medicaid expansion population, Washington University in St. Louis health economist Timothy McBride said, Missouri’s expansion program would likely stay in place.
“Then you would just have to find the money elsewhere, which would be brutal in Missouri,” McBride said.
In Crestwood, a suburb of St. Louis, Sandra Smith worries her daughter’s in-home nursing care would be on the chopping block. Nearly all in-home services are an optional part of Medicaid that states are not required to include in their programs. But the services have been critical for Sandra and her 24-year-old daughter, Sarah.
Sarah Smith has been disabled for most of her life due to seizures from a rare genetic disorder called Dravet syndrome. She has been covered by Medicaid in various ways since she was 3.
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She needs intensive, 24-hour care, and Medicaid pays for a nurse to come to their home 13 hours a day. Her mother serves as the overnight caregiver and covers when the nurses are sick — work Sandra Smith is not allowed to be compensated for and that doesn’t count toward the 63-year-old’s Social Security.
Having nursing help allows Sandra Smith to work as an independent podcast producer and gives her a break from being the go-to-person for providing care 24 hours a day, day after day, year after year.
“I really and truly don’t know what I would do if we lost the Medicaid home care. I have no plan whatsoever,” Sandra Smith said. “It is not sustainable for anyone to do infinite, 24-hour care without dire physical health, mental health, and financial consequences, especially as we parents get into our elder years.”
Elias Tsapelas, director of fiscal policy at the conservative Show-Me Institute, said potential changes to Medicaid programs depend on the extent of any budget cuts that Congress ultimately passes and how much time states have to respond.
A large cut implemented immediately, for example, would require state legislators to look for parts of the budget they have the discretion to cut quickly. But if states have time to absorb funding changes, he said, they would have more flexibility.
“I’m not ready to think that Congress is going to willingly put us on the path of making every state go cut their benefits for the most vulnerable,” Tsapelas said.
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Missouri’s congressional delegation split along party lines over the recent budget resolution calling for deep spending cuts, with the Republicans who control six of the eight House seats and both Senate seats all voting for it.
But 76% of the public, including 55% of Republicans, say they oppose major federal funding cuts to Medicaid, according to a national KFF poll conducted April 8-15.
And Missouri Sen. Josh Hawley, a Republican, has said that he does not support cutting Medicaid and posted on the social platform X that he was told by President Donald Trump that the House and Senate would not cut Medicaid benefits and that Trump won’t sign any benefit cuts.
“I hope congressional leadership will get the message,” Hawley posted. He declined to comment for this article.
U.S. House Republicans are aiming to pass a budget by Memorial Day, after many state legislatures, including Missouri’s, will have adjourned for the year.
Meanwhile, Missouri lawmakers are poised to pass a tax cut that is estimated to reduce state revenue by about $240 million in the first year.
KFF Health News is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.
