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After Promising Universal Health Care, California Governor Must Reconsider Immigrant Coverage
SACRAMENTO, Calif. — Gov. Gavin Newsom didn’t expect to be reckoning with another health care crisis.
In March, as President Donald Trump and congressional Republicans escalated a nationwide debate over whether to slash health care for poor and disabled Americans, the Democratic governor had to tell state lawmakers that California’s health care costs had spiraled out of control due to major Medicaid initiatives he backed — including the nation’s largest expansion of taxpayer-financed health care for immigrants living in the U.S. without legal permission.
His top officials at the state Department of Finance quietly disclosed to California lawmakers in a letter that the state had borrowed $3.4 billion to pay health insurers, doctors, and hospitals caring for patients enrolled in California’s Medicaid program, known as Medi-Cal. Facing rising health care costs amid a deepening state budget crisis, Newsom now must contemplate rolling back coverage and benefits.
The second-term governor faces a tough political decision: renege on his promise to achieve universal health care and strip coverage from millions of immigrants who lack legal status or look elsewhere for budget cuts. With nearly 15 million low-income or disabled residents enrolled in Medi-Cal, California has more to lose on health care than any other state. Yet even as Newsom has condemned Trump’s approach to tariffs and environmental policies, he has been tight-lipped on health policy.
Complicating his political tightrope: Polling shows that providing health care coverage for immigrants without legal status has tepid support. And any resulting budget trouble could harm his political legacy should he run for president in 2028.
“We all know that the cuts are definitely coming,” said Carlos Alarcon, a health and public benefits analyst with the California Immigrant Policy Center, which has helped spearhead a decade-long campaign in California to expand Medicaid to eligible immigrants without legal status. “The governor should keep his commitment — we’ll be very disappointed if we see cuts and rollbacks. When times get hard, it’s always our marginalized and underserved communities that lose out.”
California allows any low-income adults to enroll in Medi-Cal if they earn 138% of the federal poverty level, or $21,597 a year or less, regardless of immigration status. But the costs have been dramatically higher than expected.
Democratic Gov. Jerry Brown expanded Medi-Cal to people age 19 and younger without legal status, but he expressed reluctance to go further because of potential costs. Newsom signed bills into law adding people age 20 and older. An estimated 1.6 million immigrants without legal status are now covered, and costs have soared to $9.5 billion per year, up from $6.4 billion estimated in November. The federal government chips in roughly $1.1 billion of that total for pregnancy and emergency care.
“We can expand out of the graciousness of our heart to everywhere and anywhere, but the moment these resources run out, now everybody loses. We’re hitting that breaking point,” said California Assembly member David Tangipa, a Fresno Republican. “Either we get fiscally responsible, or there’s not going to be services for anybody — and that includes the Californian and the undocumented immigrant.”
Democratic leaders responsible for approving the state budget declined interviews. In a statement, state Sen. María Elena Durazo, a Los Angeles Democrat, who championed the expansion in the legislature, said, “Rolling back this progress would be a harmful and shortsighted decision.”
Lawmakers are considering freezing enrollment for immigrants without legal status, imposing cost-sharing measures such as drug copays or premiums, or restricting benefits, according to people familiar with the matter, who asked not to be identified to protect relationships at the state Capitol.
However, it’s unlikely Newsom will slash funding in his budget revision set for release on May 14. Instead, cuts would follow if congressional Republicans approve a budget deal with major reductions in federal spending on Medicaid.
“This is going to be very problematic for the governor. Budget cuts will disrupt the lives of millions of immigrants who just got health care, but the governor has got to do something, because this is not sustainable,” said Mark Peterson, an expert on health care and national politics at UCLA. “The prospect of cutting other places in order to support immigrants living in the country illegally would be a hard political sale; I don’t see that happening.”
Should Newsom, along with the Democratic-controlled legislature, be forced to make cuts, he could argue he had no choice. Trump and congressional Republicans have threatened states like California with the latest U.S. House proposal cutting Medicaid funding by 10 percentage points for states that provide coverage for immigrants without legal status.For Newsom, political analysts say, Trump could make an easy scapegoat.
“He can blame Trump — there’s only so much money to go around,” said Mike Madrid, an anti-Trump Republican political analyst in California who specializes in Latino issues. “It’s making people look at the health care that they can’t afford and ask, ‘Why the hell are we giving it for free to people who are here illegally?’”
The exorbitant cost has come as somewhat of a surprise.
In Newsom’s first budget proposal as governor — in which he called for expanding Medi-Cal to young adults without legal status — his administration estimated it would cost roughly $2.4 billion annually to extend benefits to all eligible people regardless of status. But the latest figure reported to legislators was nearly four times as much.
Newsom declined to respond to questions from KFF Health News, instead referencing previous comments that leave the door open to scaling back Medi-Cal. The governor noted “sober” discussions with lawmakers and said cutting Medi-Cal is “an open-ended question” that the president will heavily influence.
“What’s the impact of Donald Trump on a lot of these things? What’s the impact of federal vandalism to a lot of these programs?” Newsom asked rhetorically in December, suggesting it’s unclear whether he’ll be able to sustain the expansion to immigrants without legal status in future years.
Newsom expanded Medi-Cal in three phases, starting with immigrants ages 19 to 25, who became eligible in 2020, resisting pressure from health care advocates for one big, costly expansion. He argued doing it incrementally would ultimately save California money.
“It is the right thing morally and ethically,” Newsom said in 2020. “It is also the financially responsible thing to do.”
Record budget surpluses in recent years allowed Democrats to continue. Older adults ages 50 to 64 became eligible in 2022, and Newsom closed the gap the following year, approving coverage starting in 2024 for the biggest group, those ages 26 to 49.
But the costs have grown tremendously while the budget picture has soured, according to a KFF analysis of the most recent 2023 records available from the state Department of Health Care Services, which administers Medi-Cal.
Aside from children, it was more expensive to provide Medicaid coverage to immigrants without legal status than to legal residents. For instance, Medi-Cal paid L.A. Care, a major health insurer in Los Angeles, an average of $495.32 monthly to provide care for a childless adult without legal status and $266.77 for a legal resident without kids.
Not only were immigrants without legal status more expensive, California footed most of the cost. The state paid roughly between 60% and 70% of health care costs for a childless adult immigrant covered by L.A. Care, and about 10% for a legal resident without kids. Those costs don’t encapsulate the entire cost of providing care, which can vary depending on where Medi-Cal patients live, and grow higher when filling prescriptions, going to the dentist, or seeking mental health care.
These payments also differ by insurer, but the trend holds across the state’s Medi-Cal health insurance plans. Patients in most of the state can choose from more than one health plan.
Children without legal status in many cases were cheaper to cover than children who were legal residents. Generally, kids are healthier and require less care.
Mike Genest, who served as finance director under former Republican Gov. Arnold Schwarzenegger, argued that the state should have planned for the immense price tag.
“The idea that we’d be able to afford in the long run paying for health care for all these undocumented people — it’s beyond unsustainable,” Genest said.
While costs are high now, the expansion of Medi-Cal will result in long-term savings to taxpayers and the health care system, said Anthony Wright, who previously lobbied for the expansion as the head of the nonprofit Health Access and is now fighting Medicaid cuts as the executive director of Families USA, based in Washington, D.C.
“They’re going to be showing up in our health care system regardless,” Wright said. “Leaving them without health insurance is just going to end in more crowded emergency rooms, and it’s going to cost even more. It doesn’t make any sense economically for them to be uninsured; that takes critical revenue from clinics and hospitals, just causing more problems.”
This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
USE OUR CONTENTThis story can be republished for free (details).
HHS Acts to Protect Health Care Workers’ Conscience Rights
Medicaid Payments Barely Keep Hospital Mental Health Units Afloat. Federal Cuts Could Sink Them.
SPENCER, Iowa — This town’s hospital is a holdout on behalf of people going through mental health crises. The facility’s leaders have pledged not to shutter their inpatient psychiatric unit, as dozens of other U.S. hospitals have.
Keeping that promise could soon get tougher if Congress slashes Medicaid funding. The joint federal-state health program covers an unusually large share of mental health patients, and hospital industry leaders say spending cuts could accelerate a decades-long wave of psychiatric unit closures.
At least eight other Iowa hospitals have stopped offering inpatient mental health care since 2007, forcing people in crisis to seek help in distant facilities. Spencer Hospital is one of the smallest in Iowa still offering the service.
CEO Brenda Tiefenthaler said 40% of her hospital’s psychiatric inpatients are covered by Medicaid, compared with about 12% of all inpatients. An additional 10% of the hospital’s psychiatric inpatients are uninsured. National experts say such disparities are common.
Tiefenthaler vows to keep her nonprofit hospital’s 14-bed psychiatric unit open, even though it loses $2 million per year. That’s a significant loss for an organization with an overall annual budget of about $120 million. But the people who use the psychiatric unit need medical care, “just like people who have chest pains,” Tiefenthaler said.
Medicaid covers health care for about 72 million Americans with low incomes or disabilities. Tiefenthaler predicts that if some of them are kicked off the program and left without insurance coverage, more people would delay treatment for mental health problems until their lives spin out of control.
“Then they’re going to enter through the emergency room when they’re in a crisis,” she said. “That’s not really a solution to what we have going on in our country.”
Republican congressional leaders have vowed to protect Medicaid for people who need it, but they also have called for billions of dollars in cuts to areas of the federal budget that include the program.
The U.S. already faces a deep shortage of inpatient mental health services, many of which were reduced or eliminated by private hospitals and public institutions, said Jennifer Snow, director of government relations and policy for the National Alliance on Mental Illness. At the same time, the number of people experiencing mental problems has climbed.
“I don’t even want to think about how much worse it could get,” she said.
The American Hospital Association estimates nearly 100 U.S. hospitals have shuttered their inpatient mental health services in the past decade.
Such closures are often attributed to mental health services being more likely to lose money than many other types of health care. “I’m not blaming the hospitals,” Snow said. “They need to keep their doors open.”
Medicaid generally pays hospitals lower rates for services than they receive from private insurance or from Medicare, the federal program that mostly covers people 65 or older. And Medicaid recipients are particularly likely to need mental health care. More than a third of nonelderly Medicaid enrollees have some sort of mental illness, according to a report from KFF, a nonprofit health policy organization that includes KFF Health News. Iowa has the highest rate of mental illness among nonelderly Medicaid recipients, at 51%.
As of February, just 20 of Iowa’s 116 community hospitals had inpatient psychiatric units, according to a state registry. Iowa also has four freestanding mental hospitals, including two run by the state.
Iowa, with 3.2 million residents, has a total of about 760 inpatient mental health beds that are staffed to care for patients, the state reports. The Treatment Advocacy Center, a national group seeking improved mental health care, says the “absolute minimum” of such beds would translate to about 960 for Iowa’s population, and the optimal number would be about 1,920.
Most of Iowa’s psychiatric beds are in metro areas, and it can take several days for a slot to come open. In the meantime, patients routinely wait in emergency departments.
Sheriff’s deputies often are assigned to transport patients to available facilities when treatment is court-ordered.
“It’s not uncommon for us to drive five or six hours,” said Clay County Sheriff Chris Raveling, whose northwestern Iowa county includes Spencer, a city of 11,000 people.
He said Spencer Hospital’s mental health unit often is too full to accept new patients and, like many such facilities, it declines to take patients who are violent or charged with crimes.
The result is that people are held in jail on minor charges stemming from their mental illnesses or addictions, the sheriff said. “They really shouldn’t be in jail,” he said. “Did they commit a crime? Yes. But I don’t think they did it on purpose.”
Raveling said authorities in many cases decide to hold people in jail so they don’t hurt themselves or others while awaiting treatment. He has seen the problems worsen in his 25 years in law enforcement.
Most people with mental health issues can be treated as outpatients, but many of those services also depend heavily on Medicaid and could be vulnerable to budget cuts.
Jon Ulven, a psychologist who practices in Moorhead, Minnesota, and neighboring Fargo, North Dakota, said he’s particularly worried about patients who develop psychosis, which often begins in the teenage years or early adulthood. If they’re started right away on medication and therapy, “we can have a dramatic influence on that person for the rest of their life,” he said. But if treatment is delayed, their symptoms often become harder to reverse.
Ulven, who helps oversee mental health services in his region for the multistate Sanford Health system, said he’s also concerned about people with other mental health challenges, including depression. He noted a study published in 2022 that showed suicide rates rose faster in states that declined to expand their Medicaid programs than in states that agreed to expand their programs to cover more low-income adults. If Medicaid rolls are reduced again, he said, more people would be uninsured and fewer services would be available. That could lead to more suicides.
Nationally, Medicaid covered nearly 41% of psychiatric inpatients cared for in 2024 by a sample of 680 hospitals, according to an analysis done for KFF Health News by the financial consulting company Strata. In contrast, just 13% of inpatients in those hospitals’ cancer programs and 9% of inpatients in their cardiac programs were covered by Medicaid.
If Medicaid participants have mental crises after losing their coverage, hospitals or clinics would have to treat many of them for little or no payment. “These are not wealthy people. They don’t have a lot of assets,” said Steve Wasson, Strata’s chief data and intelligence officer. Even though Medicaid pays hospitals relatively low rates, he said, “it’s better than nothing.”
Birthing units, which also have been plagued by closures, face similar challenges. In the Strata sample, 37% of those units’ patients were on Medicaid in 2024.
Spencer Hospital, which has a total of 63 inpatient beds, has maintained both its birthing unit and its psychiatric unit, and its leaders plan to keep them open. Amid a critical shortage of mental health professionals, it employs two psychiatric nurse practitioners and two psychiatrists, including one providing care via video from North Carolina.
Local resident David Jacobsen appreciates the hospital’s efforts to preserve services. His son Alex was assisted by the facility’s mental health professionals during years of struggles before he died by suicide in 2020.
David Jacobsen knows how reliant such services are on Medicaid, and he worries that more hospitals will curtail mental health offerings if national leaders cut the program. “They’re hurting the people who need help the most,” he said.
People on Medicaid aren’t the only ones affected when hospitals reduce services or close treatment units. Everyone in the community loses access to care.
Alex Jacobsen’s family saw how common the need is. “If we can learn anything from my Alex,” one of his sisters wrote in his obituary, “it’s that mental illness is real, it doesn’t discriminate, and it takes some of the best people down in its ugly swirling drain.”
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
USE OUR CONTENTThis story can be republished for free (details).
An Arm and a Leg: A Health Policy Veteran Puts 2025 in Perspective
News has been coming out of Washington, D.C., since the start of the second Donald Trump administration like water out of a fire hose. It can feel impossible to stay on top of all the changes.
So in this episode of “An Arm and a Leg,” host Dan Weissmann speaks with KFF Health News chief Washington correspondent Julie Rovner to try to get a handle on what’s happened so far. Rovner has been covering health care in Washington for nearly 40 years and hosts the weekly health policy podcast “What the Health?”They talk about what the end of a little-known federal health regulatory agency could mean for the health care benefits of millions of Americans, with some help from KFF Health News senior correspondent Arthur Allen. Then, Rovner talks about efforts to cut Medicaid and why it may not be so easy to take apart.
Dan Weissmann @danweissmann Host and producer of "An Arm and a Leg." Previously, Dan was a staff reporter for Marketplace and Chicago's WBEZ. His work also appears on All Things Considered, Marketplace, the BBC, 99 Percent Invisible, and Reveal, from the Center for Investigative Reporting. Credits Emily Pisacreta, Claire Davenport Producers Adam Raymonda Audio wizard Ellen Weiss Editor Click to open the Transcript Transcript: A Health Policy Veteran Puts 2025 in PerspectiveNote: “An Arm and a Leg” uses speech-recognition software to generate transcripts, which may contain errors. Please use the transcript as a tool but check the corresponding audio before quoting the podcast.
Dan: Hey there–
2025 has been a LOT so far, especially since the second Trump Administration got started. We hear about a lot of sudden moves, a lot of cuts, maybe some reversals — in health care (and everywhere else). With bigger moves maybe still to come.
What’s ACTUALLY happened so far? I can’t keep up.
But I know some people who might. Our pals at KFF Health News have a whole NEWSROOM — dozens and dozens of people — publishing stories every day.
And one person in particular there is as plugged-in as can be.
Julie Rovner has been covering health care in Washington, DC for longer than anybody. Close to four decades.
When we first start talking, Julie gestures behind her. On a bookshelf in her office are copies of Congressional Quarterly, where she started reporting in the 1980s.
Julie Rovner: I mean. Literally every time somebody in Congress sneezed on healthcare, I wrote a story. That was my job. For eight years. It was sort of the beginning of my career, but I’ve sort of thought about it ever since.
Dan: Over the decades, she’s watched big changes happen incrementally, one sneeze at a time.
Julie covered health care for NPR for more than 15 years, and since 2017, she’s hosted KFF’s podcast What the Health.
Every week, she convenes a roundtable of top health-care reporters for a total inside-the-beltway nerd-fest.
And it turns out: Even Julie Rovner has a hard time maintaining an up-to-date scorecard.
Julie Rovner: I’m trying to keep a running list of what’s been cut and what’s been restored, and it’s virtually impossible ’cause there’s 20 things every day. I mean, basically the way I do my news podcast now is I spend four days a week making a list, and then on the fifth day, I cut it in half about the things we can talk about.
Dan: Oh my gosh.
Julie Rovner: And on the day of the podcast, I usually cut it in half again. Dan: So, the scorecard keeps changing too fast. But Julie does see a big picture.
And because she knows all the details– four decades of them– she can help us see it by telling us two stories:
One about a teeny part of the health care system that most of us have never heard about. Which is now one of the too-many-to-keep-track-of offices that the Trump Administration has taken a chainsaw to.
Then we’ll look at something everybody’s heard about — and lots of people are worried about: Medicaid. And Julie’s gonna show us why it may not be so easy to take apart.
This is An Arm and a Leg, a show about why health care costs so freaking much, and what we can maybe do about it. I’m Dan Weissmann– I’m a reporter, and I like a challenge. So the job we’ve chosen on this show is to take one of the most enraging, terrifying, depressing parts of American life, and bring you something entertaining, empowering, and useful.
Our first story — this little agency — teeny, by government standards — Julie actually watched it get built, early in her career. And it turns out to be a great example for this show to look at.
I mean, here’s how Julie starts telling its origin story:
Julie Rovner: In the late 1980s, there was kind of an agreement between Republicans and Democrats that healthcare costs were going up really fast and we didn’t know why. And one of the reasons is that we didn’t actually know what worked.
Dan: That is, everybody wanted to know: Why does health care cost so freaking much, and what can we maybe do about it?
And they thought: Maybe somebody should do some research about what’s actually worth paying for. Between Medicare, Medicaid, and health benefits for government workers and veterans, the federal government does a lot of the paying.
Julie Rovner: There was consensus that the federal government is spending all of this money on healthcare, they should spend at least a little bit of it, trying to figure out what works. And there should be some kind of, you know, referee, like a government agency.
Dan: And of course that agency would need a name..
Julie Rovner: It was originally gonna be the Agency for Healthcare Research and Policy, but somebody figured out at the last minute that that would make its acronym AH-CRAP and they decided that was a bad idea.
Dan: So they reversed the last two bits and called it the Agency for Healthcare Policy and Research.
Julie Rovner: My favorite piece of health policy trivia.
Dan: What can you tell me about the various sneezes and hiccups and coughs along the way?
Julie Rovner: Oh, well there was quite a fight in creating “ah-crap.”
Dan: Even though the idea had backers among both Democrats and Republicans, they had to deal with constituencies — interest groups — with turf to protect.
Julie Rovner: There were medical organizations and insurance companies and they did not want the government dictating how medicine would be practiced. So it was not, you know, it was not a done deal. It took a lot of negotiating.
Dan: And in 1989, the first year of George H.W. Bush’s presidency, neither political party could muscle anything through.
Julie Rovner: Democrats are in charge of Congress. Republicans are in charge of the White House. Hence, anything that’s gonna happen is gonna be bipartisan. Unless they’re gonna try to override a veto. And hint hint, there were a couple of attempts to override George HW Bush vetoes, and
they all failed by a couple of votes, mostly on abortion stuff. And there was an NIH bill because I remember obscure things like this.
Dan: I mean, you see why Julie is THE person to give us this story, right?
So the agency gets created in 1989. and one of its jobs is creating practice guidelines. Official federal recommendations about treatments: Which ones worked, which ones don’t.
Julie Rovner: It puts out an awful lot of guidelines and surprise, some of them were really controversial.
Dan: Some eye doctors didn’t like a guideline on cataracts. The Pharma industry hated A guideline that recommended reducing the use of brand-new drugs.
Julie Rovner: Then mid nineties they come out with one on back pain, on acute back pain. And one of the things this guideline found at looking at. All of the evidence is that. Back surgery doesn’t actually work very well for acute back pain. Um, needless to say, the nation’s spine surgeons were not thrilled.
Dan: That guideline came out in 1994. That November, Republicans scored big majorities in both houses of Congress.
NEWS ANCHOR 1: We begin tonight with the most straightforward reaction we’ve heard all day to the results of yesterday’s election. The Democratic chairman David Wilhelm said simply,“We got our butts kicked.”
NEWS ANCHOR 2: Republicans called their promises a contract.
GOP MEMBER: Today, we Republicans are signing a contract with America.
Dan: A contract that required, among other things, big budget cuts. And this little agency ended up on their hit list.
Julie Rovner: they were representing their spine surgeon constituents, and they were ready to just get rid of the whole thing. they tried to just wipe it out in the appropriation bill and they came very close, but didn’t quite
Dan: They did cut funding — including the money for creating guidelines. And they didn’t forget. In 1999, Congress passed legislation that formally kicked the agency out of the guidelines business altogether
And gave it a new name: The Agency for Healthcare Research and Quality. AHRQ (arc), for short.
Julie Rovner: Congress loves to give health agencies new names – even when they’re the same agency– because they want to sort of rid it of its baggage from the past. So we’ve renamed it, gotten it out of the guidelines business, but it is still the main Federal agency that looks at the quality of healthcare and how healthcare works.
Dan: For example, Julie says AHRQ runs the Healthcare Cost and Utilization Project. HUP for short, of course.Which keeps track of some important numbers:
Julie Rovner: How many people were in the hospital for how long? How many of them were kids? How many people got ambulatory surgery? How many hospital readmissions were there? This is that database
Dan: And maintaining that database is part of AHRQs job.
Julie Rovner: So it’s very small. But it’s the only agency that basically does what it does, which is to say we spend a fifth of our economy on healthcare. We should try to figure out how well it works. [
Dan: Or rather it was, until now. In March, officials from the Trump Administration’s Department of Government Efficiency — DOGE for short — held their first meeting with AHRQ’s leaders.
Arthur Allen: it was a meeting in person at, at their office where this was done
Dan: Julie’s KFF Health News colleague Arthur Allen talked with one of those ARQ staffers.
Arthur Allen: It was just told, we don’t know what you do. We’re gonna cut you 80, 90%.
Dan: Arthur says he found out about the whole thing by following up on a tip in a LinkedIn post. He says pitching the story wasn’t the easiest sell, even at KFF.
Arthur: Everybody was making jokes about it, They were like, yeah, good luck making an interesting story out of this. You know, good luck explaining what AHRQ does or making it into something anybody would want to read.
Dan: He did, and they published it. And it led to a new tip: As Arthur reported, ARQ was getting merged with another office in the department of Health and Human Services– the Assistant Secretary for Planning and Evaluation.
Sources from that office saw his ARQ story and told him: Their office was getting cut dramatically too.
According to his sources, between the two agencies, almost three quarters of the people are gone.
Including: everybody who was involved in calculating the federal poverty line.
As the headline for Arthur’s story says: eighty million people qualify for benefits based on that number.
Arthur Allen: It’s used by, you know, literally thousands of agencies, private, public, state, local, federal, to decide whether people qualify for benefits: food stamps, Medicaid, subsidies for childcare– you know, pretty much anything you can think of where there’s assistance to lower income people.
Dan: One of the fired workers told Arthur, quote: “There’s literally no one in the government who knows how to calculate the guidelines. And because we’re all locked out of our computers, we can’t teach anyone how to calculate them.”
Arthur Allen: The guy had been doing it for like 20 years. He was just thrown out the door and email removed. No way to reach him.
Dan: He told Arthur that using a different methodology would produce different results. If the new calculation didn’t fully account for inflation, for one example, some people could end up losing benefits. And there are a lot of other examples.
Arthur Allen: Over years, you know, you’re trying to develop the best way to do this. Any kind of number like this, which you’re trying to hone down and make it as accurate as possible, you develop this sort of fingerspitzengefühl…
Dan: What’s fingerspitzengefühl?
Arthur Allen: Well, it’s a German word that means like, feeling at the end of your fingers, where it’s like, it, it’s an undefinable ability to do something like
Dan: Like pick a lock?
Arthur Allen: Yeah. Yeah. Like Right. Exactly.
Dan: An HHS spokesperson told Arthur the department would continue to comply with statutory requirements and maintain critical programs. After the article was published, another spokesperson called KFF to say “the idea that this will come to a halt is totally incorrect. Eighty million people will not be affected.”
Arthur Allen: They were like, there are other people at HHS who can do that and, you know, it’s, it’s true. It’s just, you could have made it so much easier. And also they haven’t been the most reliable always in terms of, you know, saying something and then following through on it. So, you know, there’s reason to be skeptical.
Dan: Well, it’s, it’s a reporter’s credo, right? If your mom says she loves you, get another source.
Arthur Allen: Yeah.
Dan: So now we’ve actually looked at a COUPLE of small examples. And there are so many more. Julie Rovner sees them as part of the bigger picture..
Julie Rovner: How I’ve been thinking about this is that our healthcare system is a giant Jenga tower and it’s a little wobbly and what holds it up is everything that happens from the Department of Health and Human Services, it’s all the rules of the road. It’s all the enforcement, it’s all the protections. In many cases, it’s actually the funding. It’s what funds a lot of programs for people with low incomes, the training of, not just doctors, but future researchers. And they’re yanking out sticks from this Jenga tower as fast as they possibly can, and when the whole thing comes down, it’s gonna be very, not pretty.
Dan: She sees all those blocks getting pulled from the Jenga tower. She knows why they’re there. And what could happen as they get yanked away.
Julie Rovner: I feel a lot like I did during the early parts of the pandemic. It’s just that feeling of, oh my God, what fresh hell is next? And will we ever be able to fix it? I’m, and I’m really worried about that. And you know, at least during the pandemic, I felt like everybody felt that way.
Dan: With cuts and changes we’ve seen so far, the administration has acted on its own– and courts may or may not stop or reverse some of them.
But then there’s one of the big things lots of people worry about: huge cuts to Medicaid, which insures something like 79 million people.Cuts on the scale we’re hearing about would requires Congress to act. To pass legislation.
Which Julie Rovner thinksCongress will find very hard to do.
Julie Rovner: Not so much because it’s hard to cut Medicaid, which it is, but because it’s gonna be really hard for this Congress with these little tiny Republican majorities to agree on anything.
Dan: Julie, of course, has some very specific reasons these particular cuts will be so difficult for these particular Republican majorities. That’s next.
This episode of An Arm and a Leg is produced in partnership with KFF Health News. That’s a nonprofit newsroom covering health issues in America. Their journalists — like Julie Rovner and Arthur Allen — do amazing work. We’re honored to be colleagues.
So just to recap, here’s why cuts to Medicaid loom so large.
NEWS ANCHOR 3: Republicans are looking to slash $2 trillion with a T in long-term spending. And Medicaid could be a target
Dan: Congressional Republicans have passed a budget framework— basically, an outline — with big cuts spread across ten years.
They’ve assigned committees to find specific cuts, and they’ve given more than 800 billion dollars in cuts to a committee that doesn’t have a lot of other options
NEWS ANCHOR 4: A new analysis from the Congressional budget office shows the proposed budget would require MASSIVE cuts to Medicaid spending.
NEWS ANCHOR 5: It’s mathematically impossible for Republicans to meet their own target without cutting Medicaid.
Dan: And Julie says, cuts on this scale could hurt a lot of people.
Julie: I’ve seen estimates that 20 million people could lose their Medicaid coverage,…it’s maybe a quarter of the people on Medicaid.
Dan: Julie says Republicans want to avoid saying they’ll make these kinds of cuts. So…
Julie Rovner: You know, now Republicans are saying we’re not gonna cut Medicaid, puts the air quotes.
Dan: What they’re saying they WILL do, that’s gonna require some unpacking. Here’s the official line, as Julie puts it
Julie Rovner: We’re just gonna reduce the extra money that Medicaid pays states for the Medicaid expansion, under the Affordable Care Act.
Dan: OK. Extra money for states. Medicaid Expansion. Affordable Care Act.
Let’s break that down. The Affordable Care Act is best known for “Obamacare” marketplaces, where people can buy health insurance even if they have pre-existing conditions.
But another big thing it did was to expand Medicaid: It raised income cut-off so more people could qualify.
Now, the way Medicaid is designed, states share the cost with the federal government. But under the ACA, the feds send extra money to states, to pay for most of that expansion. Like 90 percent of it.
That’s the context for this line that Congress wouldn’t cut Medicaid, just the “extra” money to states for the expansion.
Julie Rovner: And we see a lot of Republicans saying, oh, if states wanna continue it. They can just pay their regular share. Well, that regular share is $626 billion over the next 10 years that states would cumulatively have to come up with. Um, states, unlike the federal government, pretty much have to balance their budgets every year. They don’t have 626 billion extra dollars hanging around to do that.
Dan: Julie thinks a lot of states would end up cutting Medicaid. Some would do it automatically, with laws that are already on the books.
Julie Rovner: We have 12 states that say if Congress reduces that threshold from 90%, we immediately cancel our Medicaid expansion. They’re called trigger laws and there’s 12 states with trigger laws.
Dan: But some states — not only do they not have trigger laws. They have a big problem.
Julie Rovner: Three states, three very red states, Missouri, Oklahoma, and South Dakota. Expanded Medicaid, not just by ballot measure, but by amending their state constitutions.
Dan: Yeah, this was kind of interesting: All the states that initially rejected the Medicaid expansion were led by Republican politicians.
It seems like a big reason they opposed it was because, well, it was part of the ACA– ya know, “OBAMA-care”? Their legislators would never vote for it.
But expanding Medicaid is popular with a lot of people. The legislatures in these states didn’t vote for the expansion, the people did — they voted for ballot initiatives that actually added Medicaid expansion into their state constitutions..
Julie Rovner: These three states, that change their constitutions, don’t have trigger laws because they have changed their constitution. That maybe helps explain why Senator Hawley from Missouri, who is not known as a big defender of Medicaid, uh, has said he’s not gonna vote for Medicaid cuts because his is one of the states that could be left holding a very large and expensive bag if they’ve rolled back this additional federal match. So that’s just one example. You know, when he first said it, it’s like, why is Josh Hawley suddenly so gung-ho for Medicaid? Um, that helps explain why.
Dan: That is very interesting. So this is an example of why it’s hard to cut Medicaid. Um,
Julie Rovner: Very, yes.
Dan: And Julie says, there are other reasons too.
Julie Rovner: I mean, if you go back to 2017, when the Republicans try to repeal and replace the Affordable Care Act for the first time, Medicaid turned out to be a main reason why they couldn’t, because suddenly people discovered that Medicaid is not just for, you know, moms and kids on welfare, medicaid pays. The vast majority of the nation’s nursing home bills, so everybody’s grandparents who were in nursing homes were probably getting Medicaid. Suddenly we discovered how many people were getting Medicaid and people discovered how many people were getting Medicaid, and they came to Congress.
NEWS ANCHOR 6: On Capitol Hill where there were protests and many arrests today
Crowd: Kill the bill.
News reporter: Senate Republicans today received a bruising. Welcome back to Capitol Hill…
Crowd: Kill the bill. Health care is a human right.
Julie Rovner:I was there and they said, we don’t want you to do this, you know, it, it was very close, but in the end, I think Medicaid was really a major reason why Congress proved unable to repeal the ACA, if anything, Medicaid is now more entrenched and there are more people on it than there were in 2017. Um, and Congress has even smaller majorities. You judge how hard it’s gonna be.
Dan: And as you’ve said, three states with two Republican senators each. Julie Rovner: Each. That’s correct. So there’s six.
Dan: Republicans hold 53 Senate seats. They could lose three votes and call in Vice President JD Vance to break a tie. They need 50 votes.
Julie Rovner: So they have 53 votes and six of those votes come from states. That would be left holding a very expensive bag. And another three or four senators who voted against it in 2017 are still there. So even counting to 50 is hard.
Dan: First, that’s one of Julie’s beloved Corgis in the background, amped up because he hears a neighbor dog outside.
Wally: Woof!
Julie Rovner: Wally, are you barking at Churchy? I’ll let you go play with him later.
Second, of course we don’t know what Congress will actually do in this very-unusual year.
But no matter what, it is fun talking about politics with Julie Rovner.
And even if it does not seem like a fun time to be Julie Rovner, to be doing the job she does — drinking from the firehose, as she says — I don’t think she’s going anywhere.
Julie Rovner: Yeah, I mean, you know, my mom was a journalist. My dad was a, a political staffer, basically. He worked at the state, federal, and local level in his career and basically, you know, made policy happen. And, , that is my legacy and I really care about it.
Dan: And, she is not taking in absolutely EVERYTHING. For instance, she has not been watching “The Pitt.” The super-exciting– and super-stressful–new medical drama we talked about last time–the one that chronicles an especially-intense day in a busy urban emergency room.
Julie Rovner: I started to watch it –and I watched every episode of ER. I mean, I’m one of those people. I’ve also seen every episode of Grey’s Anatomy which is insane. Um, but I started to watch the Pitt and I got about three quarters of the way into the first episode, and I thought, I cannot deal with this right now. And I turned it off.
Dan: Yeah.
Julie Rovner: I just– and I watched severance! I’m like,‘Why am I watching severance? I do not need anything creepy in my life right now.’ But it was very good. It’s funny, I could get through severance, but I could not get through The Pitt.
Dan: So, even Julie Rovner has her limits. Which I think is great.
She is doing the thing I remind everyone to do at the end of every episode of this show: Taking care of herself.
If you have not subscribed to our First Aid Kit newsletter yet, I think this is a great time to check it out.
It’s where we boil down some of the practical things we’ve learned about taking care of ourselves and each other:
My colleague Claire Davenport has been helping her roommate fight back against more than 14 thousand dollars in medical bills. They wiped out ten thousand with some due diligence.
And I’m collecting advice for what could be a one-page resource: Some quick advice and links that everybody should get before the first hospital bill arrives.
You can sign up– and read everything we’ve done so far — at arm and a leg show dot com, slash first aid kit.
We’ll be back with a new episode in a few weeks.
Until then, take care of yourself.
This episode of An Arm and a Leg was produced by me, Dan Weissmann–, with help from Emily Pisacreta, Claire Davenport, and Zach Dyer of KFF Health News –And edited by Ellen Weiss.
Adam Raymonda is our audio wizard.
Our music is by Dave Weiner and Blue Dot Sessions.
Bea Bosco is our consulting director of operations.
Lynne Johnson is our operations manager.
An Arm and a Leg is produced in partnership with KFF Health News. That’s a national newsroom producing in-depth journalism about health issues in America —
and a core program at KFF: an independent source of health policy research, polling, and journalism.
Zach Dyer is senior audio producer at KFF Health News. He’s editorial liaison to this show.
An Arm and a Leg is Distributed by KUOW– Seattle’s NPR station. And thanks to the Institute for Nonprofit News for serving as our fiscal sponsor. They allow us to accept tax-exempt donations. You can learn more about INN at INN.org.
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Trump Once Vowed To End HIV in America. His Funding Cuts Are Rolling Back Progress.
In his first term, President Donald Trump promised to end America’s HIV epidemic — and he put the resources of the federal government behind the effort. This time, he has deployed the powers of his office to gut funding, abandoning those communities at highest risk of HIV.
Health care groups across the South are scaling back HIV testing and outreach because of the Trump administration’s budget cuts and layoffs.
A small clinic in Hattiesburg, Mississippi, is no longer offering people HIV testing. The AIDS Services Coalition’s grant for HIV prevention from the Centers for Disease Control and Prevention had been delayed for months — a situation linked partly to CDC layoffs that included grant administrators. The coalition couldn’t afford to run the clinic with no promise of reimbursement.
At a recent event in Jackson, nonprofit groups offered free hoagies, showers, blood pressure checks, and HIV tests to people in need. The organizers commiserated over notices they’d received days earlier, cutting hundreds of thousands of dollars in federal funding that had been swept up in the Trump administration’s termination of research dollars and clawback of more than $11 billion from health departments nationwide. That would mean feeding fewer people and offering less care.
The loss could prove tragic, said June Gipson, CEO of the health care group My Brother’s Keeper. People who lack stable housing, transportation, or access to health care often need extra support to get tested for HIV or to stay on treatment. Otherwise, Gipson said, more people will become sicker with HIV and stand a greater chance of spreading the virus to others.
Directors of other community-based groups in Mississippi, Alabama, Louisiana, and Tennessee told KFF Health News they too reduced spending on HIV testing and outreach because of delayed or slashed federal funds — or fears of more cuts to come.
This is a particular problem in the South, as the region accounted for half of the nation’s new HIV cases in 2022. Southern states also heavily rely on federal funds: Mississippi, Alabama, and Louisiana put zero state funds into HIV prevention last year, compared with half of Colorado’s budget coming from the state and 88% of New York’s.
“When you are in the South, you need the federal government,” Gipson said.
Since February, My Brother’s Keeper has lost a succession of grants. The National Institutes of Health pulled one worth $12 million, not even two years into a 10-year project, meant to tackle inequities. The NIH’s termination letter echoed executive orders attacking diversity, equity, and inclusion. Next, the group lost a CDC award to reduce health disparities. More cuts are on the horizon if Congress passes the Trump administration’s proposed budget, which slashes the CDC’s budget by $3.59 billion. And its plan, leaked in April, for the Department of Health and Human Services eliminates all funding for Trump’s first-term initiative “Ending the HIV Epidemic.” From 2017 to 2022, new HIV infections decreased by 21% in the cities and Southern states it targeted.
“We’re seeing an about-face of what it means to truly work towards ending HIV in this country,” said Dafina Ward, executive director of the Southern AIDS Coalition.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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FDA Approves Three Food Colors from Natural Sources
Honey, Sweetie, Dearie: The Perils of Elderspeak
A prime example of elderspeak: Cindy Smith was visiting her father in his assisted living apartment in Roseville, California. An aide who was trying to induce him to do something — Smith no longer remembers exactly what — said, “Let me help you, sweetheart.”
“He just gave her The Look — under his bushy eyebrows — and said, ‘What, are we getting married?’” recalled Smith, who had a good laugh, she said. Her father was then 92, a retired county planner and a World War II veteran; macular degeneration had reduced the quality of his vision, and he used a walker to get around, but he remained cognitively sharp.
“He wouldn’t normally get too frosty with people,” Smith said. “But he did have the sense that he was a grown-up and he wasn’t always treated like one.”
People understand almost intuitively what “elderspeak” means. “It’s communication to older adults that sounds like baby talk,” said Clarissa Shaw, a dementia care researcher at the University of Iowa College of Nursing and a co-author of a recent article that helps researchers document its use.
“It arises from an ageist assumption of frailty, incompetence, and dependence.”
Its elements include inappropriate endearments. “Elderspeak can be controlling, kind of bossy, so to soften that message there’s ‘honey,’ ‘dearie,’ ‘sweetie,’” said Kristine Williams, a nurse gerontologist at the University of Kansas School of Nursing and another co-author of the article.
“We have negative stereotypes of older adults, so we change the way we talk.”
Or caregivers may resort to plural pronouns: Are we ready to take our bath? There, the implication “is that the person’s not able to act as an individual,” Williams said. “Hopefully, I’m not taking the bath with you.”
Sometimes, elderspeakers employ a louder volume, shorter sentences, or simple words intoned slowly. Or they may adopt an exaggerated, singsong vocal quality more suited to preschoolers, along with words like “potty” or “jammies.”
With what are known as tag questions — It’s time for you to eat lunch now, right? — “You’re asking them a question but you’re not letting them respond,” Williams explained. “You’re telling them how to respond.”
Studies in nursing homes show how commonplace such speech is. When Williams, Shaw, and their team analyzed video recordings of 80 interactions between staff and residents with dementia, they found that 84% involved some form of elderspeak.
“Most of elderspeak is well intended. People are trying to show they care,” Williams said. “They don’t realize the negative messages that come through.”
For example, among nursing home residents with dementia, studies have found a relationship between exposure to elderspeak and behaviors collectively known as resistance to care.
“People can turn away or cry or say no,” Williams explained. “They may clench their mouths shut when you’re trying to feed them.” Sometimes, they push caregivers away or strike them.
She and her team developed a training program called CHAT, for Changing Talk: three hourlong sessions that include videos of communication between staff members and patients, intended to reduce elderspeak.
It worked. Before the training, in 13 nursing homes in Kansas and Missouri, almost 35% of the time spent in interactions consisted of elderspeak; that share dropped to about 20% afterward.
Furthermore, resistant behaviors accounted for almost 36% of the time spent in encounters; after training, that proportion fell to about 20%.
A study conducted in a Midwestern hospital, again among patients with dementia, found the same sort of decline in resistance behavior.
What’s more, CHAT training in nursing homes was associated with lower use of antipsychotic drugs. Though the results did not reach statistical significance, due in part to the small sample size, the research team deemed them “clinically significant.”
“Many of these medications have a black box warning from the FDA,” Williams said of the drugs. “It’s risky to use them in frail, older adults” because of their side effects.
Now, Williams, Shaw, and their colleagues have streamlined the CHAT training and adapted it for online use. They are examining its effects in about 200 nursing homes nationwide.
Even without formal training programs, individuals and institutions can combat elderspeak. Kathleen Carmody, owner of Senior Matters Home Health Care and Consulting in Columbus, Ohio, cautions her aides to address clients as Mr. or Mrs. or Ms., “unless or until they say, ‘Please call me Betty.’”
In long-term care, however, families and residents may worry that correcting the way staff members speak could create antagonism.
A few years ago, Carol Fahy was fuming about the way aides at an assisted living facility in suburban Cleveland treated her mother, who was blind and had become increasingly dependent in her 80s.
Calling her “sweetie” and “honey babe,” the staff “would hover and coo, and they put her hair up in two pigtails on top of her head, like you would with a toddler,” said Fahy, a psychologist in Kaneohe, Hawaii.
Although she recognized the aides’ agreeable intentions, “there’s a falseness about it,” she said. “It doesn’t make someone feel good. It’s actually alienating.”
Fahy considered discussing her objections with the aides, but “I didn’t want them to retaliate.” Eventually, for several reasons, she moved her mother to another facility.
Yet objecting to elderspeak need not become adversarial, Shaw said. Residents and patients — and people who encounter elderspeak elsewhere, because it’s hardly limited to health care settings — can politely explain how they prefer to be spoken to and what they want to be called.
Cultural differences also come into play. Felipe Agudelo, who teaches health communications at Boston University, pointed out that in certain contexts a diminutive or term of endearment “doesn’t come from underestimating your intellectual ability. It’s a term of affection.”
He emigrated from Colombia, where his 80-year-old mother takes no offense when a doctor or health care worker asks her to “tómese la pastillita” (take this little pill) or “mueva la manito” (move the little hand).
That’s customary, and “she feels she’s talking to someone who cares,” Agudelo said.
“Come to a place of negotiation,” he advised. “It doesn’t have to be challenging. The patient has the right to say, ‘I don’t like your talking to me that way.’”
In return, the worker “should acknowledge that the recipient may not come from the same cultural background,” he said. That person can respond, “This is the way I usually talk, but I can change it.”
Lisa Greim, 65, a retired writer in Arvada, Colorado, pushed back against elderspeak recently when she enrolled in Medicare drug coverage.
Suddenly, she recounted in an email, a mail-order pharmacy began calling almost daily because she hadn’t filled a prescription as expected.
These “gently condescending” callers, apparently reading from a script, all said, “It’s hard to remember to take our meds, isn’t it?” — as if they were swallowing pills together with Greim.
Annoyed by their presumption, and their follow-up question about how frequently she forgot her medications, Greim informed them that having stocked up earlier, she had a sufficient supply, thanks. She would reorder when she needed more.
Then, “I asked them to stop calling,” she said. “And they did.”
The New Old Age is produced through a partnership with The New York Times.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
USE OUR CONTENTThis story can be republished for free (details).
Trump Team Faces Key Legal Decision That Could Put Mental Health Parity in Peril
The Trump administration must soon make a decision that will affect millions of Americans’ ability to access and afford mental health and addiction care.
The administration is facing a May 12 deadline to declare if it will defend Biden-era regulations that aim to enforce mental health parity — the idea that insurers must cover mental illness and addiction treatment comparably to physical treatments for ailments such as cancer or high blood pressure.
Although a federal parity law has been on the books since 2008, the regulations in question were issued last September. They represent the latest development in a nearly two-decade push by advocates, regulators, and lawmakers to ensure insurance plans cover mental health care equitably to physical health care.
Within the dense 166-page final rule, two provisions have garnered particular attention: first, that insurers provide “meaningful benefits” — as defined by independent medical standards — for covered mental health conditions if they do so for physical conditions. For example, if insurers cover screening and insulin treatment for diabetes, then they can’t cover screening alone for opioid addiction; they must also cover medications to treat opioid use disorder.
Second, insurers must go beyond the written words of their policies to measure how they work in practice. For example, are patients having to seek out-of-network care more often for mental than physical care? If so, and it relates to an insurer’s policies, then those policies must be adjusted.
In January, a trade association representing about 100 large employers sued the federal government, claiming the regulations overstepped the administration’s authority, would increase costs, and risked reducing the quality of care. The ERISA Industry Committee represents several Fortune 500 companies, such as PepsiCo and Comcast, which sponsor health insurance plans for their employees and would be directly affected by the new regulations.
ERIC’s lawsuit, filed days before President Donald Trump’s inauguration, puts the onus on the new administration to decide whether to defend the regulations. If it chooses not to, the rules could be scrapped.
Mental health clinicians, patients, and advocates are urging the administration to fight back.
“What we’re trying to do is make the spirit of parity a practical reality,” said Patrick Kennedy, a Democratic former U.S. representative who sponsored the 2008 parity law in the House and co-founded the Kennedy Forum, which advocates on mental health issues. This is “an existential issue for the country, public health, for every aspect of our society.”
A 2023 national survey found that more than 6 million adults with mental illness who wanted treatment in the past year were unable to receive it. Cost was one of the most common barriers.
This lack of treatment harms people’s physical health too, with research suggesting that undertreating depression can complicate chronic conditions, such as diabetes.
Kennedy hopes that connection will prompt support from the Trump administration, which has made chronic disease a central focus of its “Make America Healthy Again” agenda.
“You’re never going to get MAHA if you don’t integrate mental health,” Kennedy said, mentioning the broad health movement embraced by his cousin HHS Secretary Robert F. Kennedy Jr.
But James Gelfand, president and CEO of ERIC, said the regulations are a misguided attempt to solve the nation’s mental health care crisis.
People’s difficulty accessing therapy or medication has less to do with insurance policy and more to do with a severe shortage of mental health care providers, he said, adding, “No amount of penalties on employers” or new parity regulations “is going to change that dynamic until we get more of these providers.”
This point is at the heart of debate about parity issues. Is mental health care difficult to access because there are few providers, or are providers not accepting insurance because of low reimbursement rates? A recent study by the research institute RTI International suggests it has more to do with payment.
The departments of Justice, Labor, and Health and Human Services declined to comment for this article. The Treasury Department, which is also involved in the lawsuit, did not respond to requests for comment.
‘They Bank on You Just Giving Up’
Psychiatric nurse practitioner Gabrielle Abelard employs about 40 clinicians in her therapy practice, which serves about 2,500 clients across Massachusetts each year.
One of the programs she’s most proud to offer is intensive in-home therapy for children with serious behavioral challenges, such as intergenerational trauma, aggressive outbursts, and self-harm. Two clinicians visit the child’s home over months and work with the family, the child’s doctors, and school staff.
“A big part of the work being done is helping to keep children in school, helping to keep them out of the hospital and even out of jail,” Abelard said.
But insurance barriers sometimes hinder the services.
Abelard’s staff has to obtain prior authorization from insurers before they can provide care. Then they have to reapply for authorization every two, three, or six months, depending on the insurer. When that reauthorization is delayed, Abelard faces a dilemma: continue seeing clients knowing insurers may not pay for those services or leave clients without care until the reauthorization comes through.
Continuing services has cost her tens of thousands of dollars, she said, and months of bureaucratic hurdles to obtain back payments from insurers.
“They bank on you just giving up,” she said.
A goal of the landmark 2008 Mental Health Parity and Addiction Equity Act was to decrease dilemmas such as Abelard’s.
But the bipartisan law primarily emphasized easy-to-measure treatment limits, saying insurers could not impose higher deductibles or copays for mental health care than they did for physical health care. What received less attention was how insurers should handle other limitations, such as prior authorization or fail-first requirements for patients to try certain therapies before they would be eligible for others.
As a result, true parity remained elusive, said Deborah Steinberg, a senior health policy attorney at the nonprofit Legal Action Center.
In 2020, Congress tried to address this through a new law, signed by Trump in his first term. The law required insurance plans to systematically analyze differences in certain treatment limitations for mental and physical health care and submit those analyses upon request to states and the federal governments.
As the federal government reviewed some of those analyses, it discovered numerous parity violations. In a 2022 report, it detailed how some insurance plans covered nutritional counseling for diabetes, but not for anorexia or bulimia. Another plan required precertification for all outpatient mental health and addiction services but only for a select few outpatient medical and surgical services.
The regulations issued in September aimed to provide insurers more guidance on the 2020 law and close loopholes that allowed such disparities, Steinberg said.
‘Supply Is the Biggest Problem’
One of the biggest changes in the new regulations was the focus on outcomes, such as how often patients go out of network for mental versus physical care.
Steinberg called the provision “a really important change.” But Gelfand, president of the employer association suing to stop the regulations, said it ignores the complexity of mental health care.
Many factors outside employers’ and insurers’ control affect how often a patient goes out of network, he said, including the availability of providers in the area, regional variations in clinical practices, and the patient’s personal preference.
Mental health clinicians know there’s high demand for their services, so they have a lot of market power. That “is creating the bad behavior from these providers,” Gelfand said, such as refusing to accept insurance and not submitting out-of-network bills on clients’ behalf.
“Supply is the biggest problem,” Gelfand said.
However, the RTI International study challenged that premise, with the authors noting that primary care physicians are in shorter supply than behavioral health providers yet have much lower out-of-network use.
The authors point to insurance reimbursements as the culprit instead. The study found that insurance reimbursements for behavioral health visits are, on average, 22% lower than for medical or surgical office visits. The low pay creates a disincentive for psychologists and psychiatrists to join insurance networks.
But the fix may not be as easy as raising reimbursement rates. Companies are already paying increasingly high premiums for employees’ health insurance and many are concerned about sustaining these benefits.
ERIC has championed other strategies, such as reforming medical education and residency programs to produce more mental health care providers, increasing telehealth services, and training primary care doctors to address basic mental health concerns. The organization often lobbies state and federal lawmakers, writes letters to regulatory agencies, and testifies before Congress on these issues.
Narrowly focusing on insurance regulations could have unintended consequences, Gelfand said. Increased costs for health plans may get passed on to consumers. Or, in an attempt to keep costs down, insurers may narrow the size of their physical health care networks to match the mental health ones. In a worst-case scenario, employers could stop providing mental health benefits altogether.
Advocates say that’s unlikely, since many employees have come to expect this type of coverage, and employers recognize that providing mental health benefits can increase worker productivity and retention.
Patrick Kennedy also pointed to the bigger picture around these issues: If people do not have insurance coverage for mental health care, they’re more likely to end up in crisis at the hospital or in the criminal justice system, he said. Their children may be sent to foster care. Taxpayers finance those systems.
“We all end up picking up the tab for not enforcing parity,” he said.
But what calculation the Trump administration makes — and whether it defends or drops the new regulations — remains to be seen.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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A California Lawmaker Leans Into Her Medical Training in Fight for Health Safety Net
SACRAMENTO, Calif. — State Sen. Akilah Weber Pierson anticipates that California’s sprawling Medicaid program, known as Medi-Cal, may need to be dialed back after Gov. Gavin Newsom releases his latest budget, which could reflect a multibillion-dollar deficit.
Even so, the physician-turned-lawmaker, who was elected to the state Senate in November, says her priorities as chair of a budget health subcommittee include preserving coverage for the state’s most vulnerable, particularly children and people with chronic health conditions.
“We will be spending many, many hours and long nights figuring this out,” Weber Pierson said of the lead-up to the state’s June 15 deadline for lawmakers to pass a balanced budget.
With Medicaid cuts on the table in Washington and Medi-Cal running billions of dollars over budget due to rising drug prices and higher-than-anticipated costs to cover immigrants without legal status, Weber Pierson’s dual responsibilities — maintaining a balanced budget and delivering compassionate care to the state’s poorest residents — could make her instrumental in leading Democrats through this period of uncertainty.
President Donald Trump has said GOP efforts to cut federal spending will not touch Medicaid beyond “waste, fraud, and abuse.” Congressional Republicans are considering going after states such as California that extend coverage to immigrants without legal status and imposing restrictions on provider taxes. California voters in November made permanent the state’s tax on managed-care health plans to continue funding Medi-Cal.
The federal budget megabill is winding its way through Congress, where Republicans have set a target of $880 billion in spending cuts over 10 years from the House committee that oversees the Medicaid program.
Health care policy researchers say that would inevitably force the program to restrict eligibility, narrow the scope of benefits, or both. Medi-Cal covers 1 in 3 Californians, and more than half of its nearly $175 billion budget comes from the federal government.
One of a handful of practicing physicians in the state legislature, Weber Pierson is leaning heavily on her experience as a pediatric and adolescent gynecologist who treats children with reproductive birth defects — one of only two in Southern California.
Weber Pierson spoke to KFF Health News correspondent Christine Mai-Duc in Sacramento this spring. She has introduced bills to improve timely access to care for pregnant Medi-Cal patients, require developers to mitigate bias in artificial intelligence algorithms used in health care, and compel health plans to cover screenings for housing, food insecurity, and other social determinants of health.
This interview has been edited for length and clarity.
Q: You’re a state senator, you practice medicine in your district, and you’re also a mom. What does that look like day to day?
A: When you grow up around someone who juggles a lot, that just kind of becomes the norm. I saw this with my mom [former state Assembly member Shirley Weber, who is now secretary of state].
I’m really happy that I’m able to continue with my clinical duties. Those in the health care profession understand how much time, energy, effort, and money we put into becoming a health care provider, and I’m still fairly early in my career. With my particular specialty, it would also be a huge void in the San Diego region for me to step back.
Q: What are the biggest threats or challenges in health care right now?
A: The immediate threats are the financial issues and our budget. A lot of people do not understand the overwhelming amount of dollars that go into our health care system from the federal government.
Another issue is access. Almost everybody in California is covered by insurance. The problem is that we have not expanded access to providers. If you have insurance but your nearest labor and delivery unit is still two hours away, what exactly have we really done for those patients?
The third thing is the social determinants of health. The fact that your life expectancy is based on the ZIP code in which you were born is absolutely criminal. Why are certain areas devoid of having supermarkets where you can go and get fresh fruits and vegetables? And then we wonder why certain people have high blood pressure and diabetes and obesity.
Q: On the federal level, there’s a lot of conversation happening around Medicaid cuts, reining in the MCO tax, and potentially dropping Affordable Care Act premium subsidies. Which is the biggest threat to California?
A: To be quite honest with you, all of those. The MCO tax was a recognition that we needed more providers, and in order to get more providers, we need to increase the Medi-Cal reimbursement rates. The fact that now it is at risk is very, very concerning. That is how we are able to care for those who are our most vulnerable in our state.
Q: If those cuts do come, what do we cut? How do we cut it?
A: We are in a position where we have to talk about it at this point. Our Medi-Cal budget, outside of what the federal government may do, is exploding. We definitely have to ensure that those who are our most vulnerable — our kids, those with chronic conditions — continue to have some sort of coverage. What will that look like?
To be quite honest with you, at this point, I don’t know.
Q: How can the state make it the least painful for Californians?
A: Sometimes the last one to the table is the first one to have to leave the table. And so I think that’s probably an approach that we will look at. What were some of the more recent things that we’ve added, and we’ve added a lot of stuff lately. How can we trim down — maybe not completely eliminate, but trim down on — some of these services to try to make them more affordable?
Q: When you say the last at the table, are you talking about the expansion of Medi-Cal coverage to Californians without legal status? Certain age groups?
A: I don’t want to get ahead of this conversation, because it is a very large conversation between not only me but also the [Senate president] pro tem, the Assembly speaker, and the governor’s office. But those conversations are being had, keeping in mind that we want to provide the best care for as many people as possible.
Q: You’re carrying a bill related to AI in health care this year. Tell me what you’re trying to address.
A: It has just exploded at a speed that I don’t know any of us were anticipating. We are trying to play catch-up, because we weren’t really at the table when all of this stuff was being rolled out.
As we advance in technology, it’s been great; we’ve extended lives. But we need to make sure that the biases that led to various discrepancies and health care outcomes are not the same biases that are inputted into that system.
Q: How does Sacramento policy impact your patients and what experience as a physician do you bring to policymaking?
A: I speak with my colleagues with actual knowledge of what’s happening with our patients, what’s happening in the clinics. My patients and my fellow providers will often come to me and say, “You guys are getting ready to do this, and this is why it’s going to be a problem.” And I’m like, “OK, that’s really good to know.”
I work at a children’s facility, and right after the election, specialty hospitals were very concerned around funding and their ability to continue to practice.
In the MCO discussion, I was hearing from providers, hospitals on the ground on a regular basis. With the executive order [on gender-affirming care for transgender youth], I have seen people that I work with concerned, because these are patients that they take care of. I’m very grateful for the opportunity to be in both worlds.
This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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KFF Health News' 'What the Health?': Cutting Medicaid Is Hard — Even for the GOP
After narrowly passing a budget resolution this spring foreshadowing major Medicaid cuts, Republicans in Congress are having trouble agreeing on specific ways to save billions of dollars from a pool of funding that pays for the program without cutting benefits on which millions of Americans rely. Moderates resist changes they say would harm their constituents, while fiscal conservatives say they won’t vote for smaller cuts than those called for in the budget resolution. The fate of President Donald Trump’s “one big, beautiful bill” containing renewed tax cuts and boosted immigration enforcement could hang on a Medicaid deal.
Meanwhile, the Trump administration surprised those on both sides of the abortion debate by agreeing with the Biden administration that a Texas case challenging the FDA’s approval of the abortion pill mifepristone should be dropped. It’s clear the administration’s request is purely technical, though, and has no bearing on whether officials plan to protect the abortion pill’s availability.
This week’s panelists are Julie Rovner of KFF Health News, Anna Edney of Bloomberg News, Maya Goldman of Axios, and Sandhya Raman of CQ Roll Call.
Panelists Anna Edney Bloomberg News @annaedney @annaedney.bsky.social Read Anna's stories. Maya Goldman Axios @mayagoldman_ @maya-goldman.bsky.social Read Maya's stories Sandhya Raman CQ Roll Call @SandhyaWrites @SandhyaWrites.bsky.social Read Sandhya's stories.Among the takeaways from this week’s episode:
- Congressional Republicans are making halting progress on negotiations over government spending cuts. As hard-line House conservatives push for deeper cuts to the Medicaid program, their GOP colleagues representing districts that heavily depend on Medicaid coverage are pushing back. House Republican leaders are eying a Memorial Day deadline, and key committees are scheduled to review the legislation next week — but first, Republicans need to agree on what that legislation says.
- Trump withdrew his nomination of Janette Nesheiwat for U.S. surgeon general amid accusations she misrepresented her academic credentials and criticism from the far right. In her place, he nominated Casey Means, a physician who is an ally of HHS Secretary Robert F. Kennedy Jr.’s and a prominent advocate of the “Make America Healthy Again” movement.
- The pharmaceutical industry is on alert as Trump prepares to sign an executive order directing agencies to look into “most-favored-nation” pricing, a policy that would set U.S. drug prices to the lowest level paid by similar countries. The president explored that policy during his first administration, and the drug industry sued to stop it. Drugmakers are already on edge over Trump’s plan to impose tariffs on drugs and their ingredients.
- And Kennedy is scheduled to appear before the Senate’s Health, Education, Labor and Pensions Committee next week. The hearing would be the first time the secretary of Health and Human Services has appeared before the HELP Committee since his confirmation hearings — and all eyes are on the committee’s GOP chairman, Sen. Bill Cassidy of Louisiana, a physician who expressed deep concerns at the time, including about Kennedy’s stances on vaccines.
Also this week, Rovner interviews KFF Health News’ Lauren Sausser, who co-reported and co-wrote the latest KFF Health News’ “Bill of the Month” installment, about an unexpected bill for what seemed like preventive care. If you have an outrageous, baffling, or infuriating medical bill you’d like to share with us, you can do that here.
Plus, for “extra credit” the panelists suggest health policy stories they read this week that they think you should read, too:
Julie Rovner: NPR’s “Fired, Rehired, and Fired Again: Some Federal Workers Find They’re Suddenly Uninsured,” by Andrea Hsu.
Maya Goldman: Stat’s “Europe Unveils $565 Million Package To Retain Scientists, and Attract New Ones,” by Andrew Joseph.
Anna Edney: Bloomberg News’ “A Former TV Writer Found a Health-Care Loophole That Threatens To Blow Up Obamacare,” by Zachary R. Mider and Zeke Faux.
Sandhya Raman: The Louisiana Illuminator’s “In the Deep South, Health Care Fights Echo Civil Rights Battles,” by Anna Claire Vollers.
Also mentioned in this week’s podcast:
- ProPublica’s series “Life of the Mother: How Abortion Bans Lead to Preventable Deaths,” by Kavitha Surana, Lizzie Presser, Cassandra Jaramillo, and Stacy Kranitz, and the winner of the 2025 Pulitzer Prize for public service journalism.
- The New York Times’ “G.O.P. Targets a Medicaid Loophole Used by 49 States To Grab Federal Money,” by Margot Sanger-Katz and Sarah Kliff.
- KFF Health News’ “Seeking Spending Cuts, GOP Lawmakers Target a Tax Hospitals Love to Pay,” by Phil Galewitz.
- Axios’ “Out-of-Pocket Drug Spending Hit $98B in 2024: Report,” by Maya Goldman.
To hear all our podcasts, click here.
And subscribe to KFF Health News’ “What the Health?” on Spotify, Apple Podcasts, Pocket Casts, or wherever you listen to podcasts.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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Joint Task Force Statement Regarding Columbia University
Meet the Florida Group Chipping Away at Public Benefits One State at a Time
PHOENIX — As an Arizona bill to block people from using government aid to buy soda headed to the governor’s desk in April, the nation’s top health official joined Arizona lawmakers in the state Capitol to celebrate its passage.
Health and Human Services Secretary Robert F. Kennedy Jr. said to applause that the legislation was just the start and that he wanted to prevent federal funding from paying for other unhealthy foods.
“We’re not going to do that overnight,” Kennedy said. “We’re going to do that in the next four years.”
Those words of caution proved prescient when Arizona’s Democratic governor, Katie Hobbs, vetoed the bill a week later. Nevertheless, state legislation to restrict what low-income people can buy using Supplemental Nutrition Assistance Program benefits is gaining momentum, boosted by Kennedy’s touting it as part of his “Make America Healthy Again” platform. At least 14 states have considered bills this year with similar SNAP restrictions on specific unhealthy foods such as candy, with Idaho and Utah passing such legislation as of mid-April.
Healthy food itself isn’t largely a partisan issue, and those who study nutrition tend to agree that reducing the amount of sugary food people eat is a good idea to avoid health consequences such as heart disease. But the question over the government’s role in deciding who can buy what has become political.
The organization largely behind SNAP restriction legislation is the Foundation for Government Accountability, a conservative policy think tank out of Florida, and its affiliated lobbying arm, which has used the name Opportunity Solutions Project.
FGA has worked for more than a decade to reshape the nation’s public assistance programs. That includes SNAP, which federal data shows helps an average of 42 million people afford food each month. It also advocates for ways to cut Medicaid, the federal-state program that connects 71 million people to subsidized health care, including efforts in Idaho and Montana this year.
FGA’s proposals often seek to limit who taps into that aid and the help they receive. Those backing the group’s mission say the goal is to save tax dollars and help people lift themselves out of poverty. Critics argue that FGA’s proposals are a backdoor way to cut off aid to people who need it and that making healthy food and health care more affordable is a better fix.
Now, FGA sees more room for change under the Trump administration and the Kennedy-led health department, calling 2025 a “window of opportunity for major reform,” according to its latest annual report.
A Vision for Limiting Government Benefits
Tarren Bragdon, a former Maine legislator, founded FGA in 2011 to promote policies to “free millions from government dependency and open the doors for them to chase their own American Dream,” he said in a statement on FGA’s website. The main foundation started out as a staff of three with about $60,000 in the bank. As of 2023, it had a budget of more than $15 million and a team of roughly 64, according to the latest available tax documents, and that’s not counting the lobbying arm.
The foundation got early funding from a grant from the State Policy Network, which has long backed right-leaning think tanks with ties to conservative activists including brothers Charles and David Koch.
FGA declined several interview requests for this article.
In recent years, the nonprofit helped draft a 2017 Mississippi law, the Jackson Free Press found, which intensified eligibility checks for public aid that made it more difficult for some applicants to qualify. It successfully pushed a 2023 effort in Idaho to impose work requirements for food benefits that health care advocates said led some recipients to lose access.
The same year, the group helped pass SNAP restrictions affecting eligibility in Iowa. Since those restrictions have taken effect, the Food Bank of Iowa has seen a record number of people show up at its pantries amid rising grocery prices and a scaling back of covid pandemic-era federal support, said Annette Hacker, a vice president at the nonprofit.
Part of the group’s strategy is to pass legislation state by state, with the idea that the crush of new laws will increase pressure on the federal government. For example, states can’t limit what food is purchased through SNAP without federal approval through a waiver process. And in the past, some of FGA’s efforts have stalled because states never got that approval.
Kennedy’s agenda now echoes some of FGA’s key messages, and he has said states can expect approval of their waivers. Meanwhile, congressional leaders are eyeing nationwide Medicaid cuts and work requirements, which FGA considers among its major issues. The foundation also has a connection working inside the administration: Its former policy director, Sam Adolphsen, was tapped to advise President Donald Trump on domestic matters.
“We’re excited to fight from Topeka to Washington, D.C., as opposed to Washington, D.C., to Topeka,” Roy Lenardson, FGA’s state government affairs director, told Kansas lawmakers in February when testifying in support of SNAP legislation there.
Shaping State Policies
In the states, FGA has become known as a conservative “thought leader,” said Brian Colby, vice president of public policy for Missouri Budget Project, a progressive nonprofit that provides analysis of state policy issues.
“Conservatives used to try to chop away at the federal budget,” Colby said. “These guys are doing it at the state level.”
In its 14 years, FGA has created a playbook to shape state policy discussions around public benefits behind the scenes. In Montana, retired Republican legislator Cary Smith, who worked with FGA, said not all of the think tank’s ideas split along party lines.
“They offer a buffet of options,” he said. “Their agenda is making government accountable; it’s in the name.”
He said besides drafting legislation, FGA provides talking points and data to help policymakers support their arguments. “They would go in and would say, ‘This is what Medicaid fraud is costing us,’” Smith said. “That would be the number you’d want to use in your bill.”
In January, FGA released a memo for states to “stop taxpayer-funded junk food.” In February, Stateline reported that Wyoming Republican state Rep. Jacob Wasserburger said the group asked him to sponsor a SNAP restriction bill. The state sponsor of similar legislation in Missouri has repeated at least one of FGA’s talking points, as reported by the Missouri Independent. In Arizona, Republican Rep. Leo Biasiucci, who sponsored the SNAP legislation there, told KFF Health News FGA was behind that bill as well.
Opponents of such bills argue the proposals are not as simple as they sound. Amid debate on a SNAP bill in Montana, Kiera Condon, with the Montana Food Bank Network, testified the legislation would force grocery store workers to sort through what counts as soda or candy, “which could result in retailers not participating in SNAP at all.”
State lawmakers tabled the Montana bill in April.
Montana legislators also easily passed a bill to extend the state’s Medicaid expansion program even after FGA began publishing a series of papers that asserted the program was “breaking” Montana’s budget. FGA had presented data saying most Montanans on the program don’t work, which state data refutes.
Ed Bolen, who leads food aid strategies at the left-leaning Center on Budget and Policy Priorities think tank, said FGA has a pattern of proposing technical changes to existing laws and “unworkable work requirements” that cause people to lose benefits.
After working with policymakers in Kansas for a decade, FGA helped pass legislation that limited how long people can access cash assistance, added work requirements to SNAP, and banned the state from spending federal or state funds to promote public aid. Many of those changes came through 2015 legislation known as the “HOPE Act” drafted by FGA, The Washington Post reported.
Analysis from Kansas Appleseed, an advocacy organization for low-income Kansans, found the SNAP caseload sharply declined after the bill was enacted because of the new hurdles, dropping from 140,000 households in January 2014 to 90,000 as of January 2020.
“It’s death by a thousand cuts,” said Karen Siebert, an adviser for Harvesters, a community food bank network in Kansas and Missouri. “Some of these FGA proposals are such complex policies, it’s hard to argue against and to explain the ripple effects.”
In 2024, the foundation produced more than two dozen videos featuring state politicians from across the nation touting the organization’s goals and dozens of research papers arguing public benefits are wrecking state budgets. FGA also has its own polling team to produce data out of the states it’s working to influence.
The organization released a list of 14 states it labeled as “redder and better” places to exert more influence. That included Idaho, where the group has four registered lobbyists in the state Capitol.
In 2023, FGA helped present and successfully lobby for legislation there to require people receiving food aid to work at least 80 hours a month. The organization called the resulting law “landmark welfare reform” years in the making.
And this year, Idaho lawmakers passed more requirements for people enrolled in Medicaid who can work. FGA staffers worked with one of the co-sponsors of the legislation on a similar bill last year that failed, then again this year. A compromise bill passed with FGA’s backing, marking another victory for the foundation.
David Lehman, a lobbyist for the Idaho Association of Community Providers, which represents health organizations that have opposed FGA bills, said Idaho illustrates how FGA works with sympathetic lawmakers in conservative states to gain more ground.
“They’re pushing an already rolling rock downhill,” he said.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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Seeking Spending Cuts, GOP Lawmakers Target a Tax Hospitals Love To Pay
On the eastern plains of Colorado, in a county of less than 6,000 people, Lincoln Health runs the only hospital within a 75-minute drive. The facility struggles financially, given its small size and the area’s tiny population.
But for over a decade, the Hugo, Colorado-based health system has remained afloat partially thanks to a surprising source: special taxes on the state’s hospitals.
The taxes Lincoln pays help cover the state’s Medicaid costs and — because the federal government matches a portion of what states spend on Medicaid — enable Colorado to claim more federal money. That generally leads to more dollars for the hospital. The tax proceeds also have helped Colorado expand Medicaid under the Affordable Care Act to cover 400,000 more low-income adults, significantly reducing the number of people showing up at hospital doors without insurance.
Last year, Lincoln paid $500,000 in provider taxes but netted more than $3.6 million extra from Medicaid, accounting for about 15% of its budget, said Lincoln CEO Kevin Stansbury.
“These dollars allow me to care for patients who are enrolled in Medicaid and to break even rather than lose money,” he said. “Without them, it would significantly impact our ability to survive.”
Every state except Alaska uses at least one provider tax to boost its federal Medicaid dollars.
But Republicans who control Congress are looking for potential cuts in the nearly $900 billion Medicaid program to help fund an extension of President Donald Trump’s tax cuts — and have sought to portray provider taxes as malicious, sometimes even deriding them as “money laundering.” Lawmakers say they may curtail or eliminate provider taxes as part of legislation to enact Trump’s domestic agenda.
“It’s infuriating,” Stansbury said.
Medicaid and the closely related Children’s Health Insurance Program together cover roughly 79 million low-income and disabled people and are jointly financed by states and the federal government.
Federal dollars match state payments with no limit. While the split varies based on a state’s per capita income, the federal match ranges from 50% to 77% for children, pregnant women, and people with disabilities, who make up most of the enrollment.
States started using provider taxes in the 1980s to help pay their share and gain additional Medicaid funds from the federal government.
Brian Blase, a former Trump health policy adviser who leads the conservative Paragon Health Institute, sees provider taxes as one of the highest forms of waste in Medicaid. States and their hospitals, nursing homes, and other providers aren’t held accountable for how the tax money is used, reducing incentives for states to control Medicaid spending, he said.
“This has been a feature of the program for four decades, and it is a feature that is getting worse,” Blase said.
The Congressional Budget Office estimates eliminating provider taxes would save the federal government more than $600 billion over a decade.
Rep. Brett Guthrie (R-Ky.), who chairs the House committee that oversees Medicaid, has said provider taxes are on the menu for potential cuts.
Other changes Republicans are considering to cut federal Medicaid spending include requiring adult enrollees to prove they’re working as a condition of eligibility, as well as ending higher payments for adults enrolled as part of the Affordable Care Act’s expansion of the program.
Since 2014, more than 20 million nondisabled adults in 40 states and Washington, D.C., have gained coverage under the expansion.
House Republicans have set a Memorial Day deadline to come to an agreement on spending cuts, which would help pay for extending about $4 trillion in tax cuts passed during Trump’s first administration and set to expire at the end of this year.
The Government Accountability Office and the Medicaid and CHIP Payment and Access Commission, a congressional advisory board, have raised concerns about the provider taxes, which effectively saddle federal taxpayers with state expenses. Republican and Democrat presidents have criticized or proposed curtailing the use of Medicaid provider taxes — including Trump in his first term, Barack Obama, and Joe Biden while serving as vice president.
But opposition from hospitals, nursing homes, and states snuffed out any move to limit or end the arrangements.
Colorado and other states often use the money to maintain or increase payments to providers, which are often paid less by Medicaid than by Medicare, the federal program primarily for people 65 or older, or private insurers.
States have added provider taxes to help generate federal money to cope with economic downturns and budget constraints.
Hospitals in Idaho last year began paying an additional provider tax to increase pay to hospitals and home- and community-based providers. The tax came as Idaho’s Republican-controlled legislature sought to add many conditions that threatened to end the state’s Medicaid expansion — which would also eliminate a key source of increased federal funding.
Brian Whitlock, president and CEO of the Idaho Hospital Association, said funding from the hospital tax helps boost Medicaid payments to about 80% of Medicare’s rates instead of 60%.
“We still lose money on every Medicare and Medicaid patient,” he said. “The state recognizes that this money helps offset the losses we take under Medicaid reimbursement.”
While hospitals and nursing homes have been the main beneficiaries of provider tax proceeds, ambulance services have also paid and benefited from Medicaid taxes. States increasingly have also approved Medicaid taxes on private insurers that operate their Medicaid programs to gain more federal funds.
California’s Medicaid managed care tax began in 2009 and is expected to generate nearly $9 billion in net revenue for the 2024-25 fiscal period — or about 5% of the state’s Medicaid budget, according to the California Legislative Analyst’s Office.
In recent years, California has extended full Medicaid coverage to immigrants lacking permanent legal status. Federal law prohibits federal Medicaid dollars from being used to cover people in the country without authorization, but states can use their own money.
At a presentation to congressional staffers in April, Blase cited California’s strategy as an example of provider tax abuse and claimed the state is effectively laundering federal funds to cover people living in the U.S. without authorization.
In practice, the tax has been a kind of fiscal pressure valve generally offsetting state spending. A ballot measure that passed in November now requires that much of the money from California’s tax specifically be used to increase Medicaid reimbursement to doctors, hospitals, and other providers.
Hospital officials and state Medicaid leaders argue the term “money laundering” is an inaccurate way to describe provider taxes, since they are allowed by federal law. But Blase said calling the levies a “tax” is misleading, pointing out that most businesses don’t typically advocate to pay one.
Jamie Whitney, chief legal officer for Texas-based Adelanto HealthCare Ventures, a consulting firm, said that provider taxes are a politically neutral way to help states pay for Medicaid and that curtailing their use would harm them all. “This is not a red-state, blue-state issue,” she said.
Colorado is one of more than a dozen states that have funded an ACA Medicaid expansion using provider tax money. Others include Arkansas, Louisiana, Missouri, North Carolina, Ohio, and Virginia.
Colorado implemented its Medicaid provider tax effort in 2009. In the 2024 fiscal year, about $5 billion of the state’s $15 billion Medicaid program was funded by provider taxes, according to the state.
The money helps the state pay higher Medicaid reimbursements to hospitals, which reduces their need to charge higher rates to private insurers, said Kim Bimestefer, executive director of the Colorado Department of Health Care Policy and Financing, which oversees Medicaid.
Some of the extra payments are dependent on hospitals meeting certain quality and patient-safety metrics, such as reducing readmission rates after patients are discharged — a requirement state officials say improves care for everyone.
The provider taxes also fund a program allowing working residents with disabilities to buy into Medicaid coverage even if their income is as high as 300% of the federal poverty level, or $46,950 for an individual. About 20,000 people are enrolled in the program.
Among them is Alison Sbrana, 31, of Fort Collins, Colorado, who has a type of chronic fatigue syndrome and relies on Medicaid to cover long-term home care.
“It would be devastating if the benefit went away,” said Sbrana, who works as a researcher and activist for those with the same disorder. “I would be forced to stop working to keep my income low enough to qualify.”
The state’s provider taxes also pay for a $60 million fund to support rural hospitals, helping them add telehealth services, recruit surgeons, and hire paramedics, according to a state report.
Konnie Martin, CEO of San Luis Valley Health, a two-hospital system based in Alamosa, Colorado, said her nonprofit paid $5.4 million in provider taxes last year and gained about $15 million in benefits from higher Medicaid payments and the rural grants.
She said the money helps her hospital maintain obstetrical services, so residents don’t have to drive 120 miles to the nearest maternity hospital. Without the birthing center, the entire region would suffer, she said.
“It also would gut the economy of the community, because young people will move away,” she said.
KFF Health News senior correspondent Bernard Wolfson contributed to this report.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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NIH, CMS Partner to Advance Understanding of Autism Through Secure Access to Select Medicare and Medicaid Data
Trump Policies at Odds With ‘Make America Healthy Again’ Push
In his March address to Congress, President Donald Trump honored a Texas boy diagnosed with brain cancer. Amid bipartisan applause, he vowed to drive down childhood cancer rates through his “Make America Healthy Again” initiative.
A few days later, the administration quietly dropped a lawsuit to cut emissions from a Louisiana chemical plant linked to cancer.
At first glance, Trump appears to have fully embraced the MAHA movement championed by Health and Human Services Secretary Robert F. Kennedy Jr. From proclaiming in his congressional speech a goal to “get toxins out of our environment” to launching a new commission to study cancer and other ailments, Trump has vowed to end what he calls an epidemic of chronic disease.
But even as he extols MAHA, Trump has unleashed a slew of policies likely to make Americans less healthy. He’s slashing 20,000 full time positions from HHS and cutting more than $4 billion in indirect costs related to health research grants, including studies into treatment for Alzheimer’s and cancer. He also supported a GOP plan likely to kneecap Medicaid, a joint federal-state program that covers about 72 million Americans.
The contradictions raise doubts about the sincerity of Trump’s support for the MAHA agenda and his administration’s commitment to making a dent in chronic disease — conditions that afflict about 133 million Americans and account for roughly 90% of the $4.5 trillion spent annually in the U.S. on health care.
The administration’s attention to chronic disease is also notable for its lack of focus on expanding health insurance. Research shows people with coverage have lower death rates; insurance provides free or low-cost preventive care that can help manage chronic disease and reduce risks of serious complications.
“The layoffs at HHS, cuts to Medicaid, and reduction in research could all end up resulting in less healthy Americans,” said Larry Levitt, executive vice president for health policy at KFF. “They’re talking about getting at the root causes of chronic disease. Less research and protections will undermine that goal.” KFF is a health information nonprofit that includes KFF Health News.
HHS leaders have said that they focused personnel cuts at agencies on redundant or unnecessary administrative positions. The administration has said the job cuts will save money and make HHS more responsive.
“Streamlining bureaucracy and eliminating redundancies is how we deliver on the mission of Making America Healthy Again — not by preserving a bloated system that’s failed to improve outcomes despite record spending,” HHS spokesperson Vianca Rodriguez Feliciano said in an email.
Public health advocates say the staffing cuts run counter to the promise of a MAHA agenda dedicated to reducing chronic disease.
“HHS declared that their mission is to Make America Healthy Again,” said Sharon Gilmartin, executive director of Safe States Alliance, on a press call. The alliance is a nonprofit focused on preventing injury and violence. “How can we do that when the people who have spent decades of their life combating the health issues of our nation are being tossed out with no notice?”
The HHS workforce reductions decimated divisions focused on chronic disease.
Gone is most of the Centers for Disease Control and Prevention’s population health division, which conducted research and developed public health programs on chronic disease. Gone, too, are staffers at the National Institutes of Health who focused on Alzheimer’s research. After HHS staffers working on Alzheimer’s projects were put on administrative leave, the Alzheimer’s Association sounded the alarm about the cuts, saying in an April 1 statement that the reductions “could cause irreversible damage.”
And gone is the CDC’s Office on Smoking and Health, which worked to protect the public from the harmful effects of tobacco use. The administration also gutted the FDA’s Center for Tobacco Products, which enforces advertising restrictions. Tobacco use is the leading preventable cause of disease, disability, and death in the country.
“Cuts to CDC and FDA tobacco control programs are devastating,” Tom Frieden, who served as director of the CDC from 2009 to 2017, said April 18 on the social media platform Bluesky.
According to administration fact sheets and press releases, the staffing cuts will save $1.8 billion a year and shrink HHS’ workforce from 82,000 to 62,000 full-time employees. HHS will be retooled to focus on “safe, wholesome food, clean water, and the elimination of environmental toxins,” according to a March 27 press statement. The restructuring will improve Americans’ experience with HHS by making the agency more responsive and efficient, the statement said.
Roger Severino, a lawyer who led the HHS Office for Civil Rights during the previous Trump administration, said the job cuts are necessary because the HHS budget has grown while American health has declined.
“If you want to Make America Healthy Again, you have to make HHS healthy again. You have to trim the bureaucratic fat,” said Severino, who is now vice president of domestic policy at the Heritage Foundation, a conservative policy group. “We haven’t seen chronic disease go down or obesity go down, while autism rates are up. If this were a private company, it would have gone bankrupt years ago.”
But many public health experts question how the federal government will be able to respond to existing problems, as well as new health issues, with fewer employees and resources.
Infectious diseases are one area of concern.
Trump, on the first day of his second term in office, withdrew the nation from the World Health Organization, which detects, monitors, and responds to emerging health threats. The U.S. has been the largest financial contributor to the organization.
Without membership, the U.S. may remain in the dark if the WHO identifies an emerging threat that could ultimately spread and become global. Spillover can happen: In 2014, an Ebola outbreak in West Africa led to 11 reported cases in the U.S. The WHO played a central role in developing infection-prevention protocols and provided logistical support to affected countries.
The evisceration of the U.S. Agency for International Development could also leave the nation more vulnerable because the agency worked with countries such as Vietnam on early detection of diseases including bird flu. The agency typically would have aided in the response to a current Ebola outbreak in Uganda, providing support that doctors say helped prevent spread in past outbreaks.
The staffing reductions and frozen or canceled grants are having an immediate impact on the ability to respond to infectious outbreaks. Right now, for instance, Texas is in the throes of a measles outbreak, with more than 500 confirmed cases.
But the administration’s funding cuts forced the Dallas County health department to lay off 11 full-time workers and 10 part-time staffers responsible for responding to such outbreaks, Philip Huang, director and health authority for the Dallas County Health and Human Services Department, said at a press event.
The administration has also imperiled ongoing research, including studies and trials related to chronic disease.
Trump ended hundreds of research projects at the National Institutes of Health totaling more than $2 billion, including projects on HIV prevention drugs and Alzheimer’s disease research.
“Patients enrolled in NIH studies led by Plaintiffs face abrupt cancellations of treatment in which they have invested months of time with no explanation or plan for how to mitigate the harm,” according to a federal lawsuit filed in Massachusetts by scientists and researchers.
The research being cut could potentially have supported Trump’s pledge, when he honored the boy with brain cancer, to drive down rates of the disease. In the weeks since, however, Trump’s administration announced plans to weaken automobile tailpipe emission standards. Trump slashed more than 400 grants to Columbia University, including millions earmarked for a cancer center.
“It’s making people sicker again. Now that would be a more honest bumper sticker,” said Leslie Dach, a former Obama administration official who is the executive chair of Protect Our Care, which advocates for the Affordable Care Act. “They’re stopping research on vaccines and gutting health care programs that keep 100 million Americans healthy. It’s all show. It’s a bunch of junk.”
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
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As Republicans Eye Sweeping Medicaid Cuts, Missouri Offers a Preview
CRESTWOOD, Mo. — 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.
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 health care 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.
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.
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.
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 newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
USE OUR CONTENTThis story can be republished for free (details).