Az & Other States on the Brink of Slashing Medicaid: Millions at Risk as Trump Eyes Funding Cuts

As Donald Trump prepares for his anticipated return to the White House in 2025, attention turns to the potential implications for the Affordable Care Act’s Medicaid expansion. Many Republicans are poised to scrutinize the program, which currently provides coverage to millions of low-income Americans.

According to research from the Kaiser Family Foundation (KFF) and the Georgetown University Center for Children and Families, over 3 million adults across nine states could lose their health coverage if federal funding for Medicaid is reduced. This situation arises from trigger laws in these states that would automatically halt Medicaid expansions should federal support wane.

The states affected include Arizona, Arkansas, Illinois, Indiana, Montana, New Hampshire, North Carolina, Utah, and Virginia. Since the Affordable Care Act’s enactment in 2010, roughly 21 million individuals have gained health insurance through Medicaid expansion, significantly lowering the U.S. uninsured rate.

The federal government currently covers 90% of costs for those enrolled in the expanded Medicaid program—substantially higher than the average of 57% for traditional Medicaid beneficiaries. However, conservative groups have criticized this financial burden, arguing the program is unsustainable.

Proponents of Medicaid expansion argue it has helped save lives and improve community health. Renuka Tipirneni, a researcher at the University of Michigan, noted that a reduction in federal funding could endanger Medicaid expansion across the country, compelling states without trigger laws to re-evaluate their programs.

Political dynamics at the state level will heavily influence decisions regarding Medicaid. For instance, Michigan’s earlier decisions regarding triggers reflected shifts in political control; a Republican legislature added a trigger in 2013, while Democrats eliminated it in 2022. Among the nine states with such laws, six cast their ballots for Trump in the 2024 election.

The specifics of the trigger laws vary. Arizona’s trigger, for example, would cease Medicaid expansion if funding dips below 80%, while Montana’s similar law allows for continued expansion if alternate funding sources are found. Collectively, between 3.1 million and 3.7 million individuals across these states are at risk of losing their coverage.

The ACA enables Medicaid eligibility for adults earning up to 138% of the federal poverty level, which translates to about $20,783 for an individual in 2024. Nationally, nearly 25% of the 81 million Medicaid enrollees gained access through these expansions.

Robin Rudowitz, from KFF, emphasized the gravity of potential cuts, indicating that states may face tough choices about whether to maintain expansion if federal support diminishes. Such changes could lead to increased uninsured rates and limit access to care nationwide.

Historically, states are reluctant to reduce social program eligibility once established. However, trigger laws simplify the process for lawmakers seeking to terminate Medicaid expansion without additional legislative action, a tactic paralleling strategies used after the Supreme Court’s 2022 ruling on Roe v. Wade.

The future of Medicaid under Trump’s administration remains uncertain. Some conservative thinkers, including those at the Paragon Health Institute, have already proposed a phased reduction of federal matches for expansion enrollees, which could reshape the program significantly.

Experts are skeptical about whether states like Arizona would willingly absorb the financial burden left by reduced federal funding. Daniel Derksen noted that this would likely place substantial pressure on state budgets, making it a politically challenging proposition.

The Medicaid debate is not new territory for Republican leaders, who previously attempted to cut federal expansion funding in 2017. Those efforts ultimately failed, but the issue remains relevant as political winds shift once again.