This story was reported and written by VPM News.
About 636,000 Virginians are at risk of losing Medicaid coverage if the federal government cuts funding for the entitlement program. But state lawmakers are trying to install some protections in the commonwealth.
Sen. Creigh Deeds (D-Charlottesville) and Sen. Ghazala Hashmi (D-Chesterfield) submitted a budget amendment that would remove a trigger law that automatically ends Medicaid expansion if federal funding falls below 90% of the cost to cover the expanded group. That group includes adults younger than 65 who earn up to 138% of the federal poverty level.
Speaking with reporters following his State of the Commonwealth address, Gov. Glenn Youngkin committed to fully funding Virginia’s Medicaid responsibilities, but expressed concern about the expansion’s increasing costs.
“We do have a rapid increase in Medicaid costs in Virginia,” he said. “Finding ways that we can, in fact, address the rapidly rising costs in Medicaid ... this is important.”
For fiscal year 2023, the state paid about $692 million to cover the cost of Medicaid expansion — 10% of the total cost. That money comes from a tax on private hospitals. The federal government paid the remaining 90%, roughly $6.2 billion.
Emily Hardy, deputy director of the Center for Healthy Communities at the Virginia Poverty Law Center, said the budget amendment’s goal is to “establish an oversight review group to consider how to prevent the loss of coverage and to ensure as many people have access to healthcare as possible.”
If passed, the oversight review group would be established in the event the federal government decides to cut funding below its current 90% threshold. The group would determine alternate funding sources and report their recommendations within 45 days of the federal action.
“They should have to determine if there is a way to continue the funding to keep the program, should the federal funding be cut,” Hardy said. “It doesn’t mean that Medicaid expansion will survive if the federal reduction is extreme.”
The governor expressed doubt that the issue could be addressed during this year’s General Assembly session, but lawmakers hope to find a solution to stop a loss of coverage.
"The language really focuses on putting the onus on trying to preserve the program and to preserve people’s health care if possible,” Hardy said. “We hope that we’re able to keep the program, since it’s a fundamental service for over half a million Virginians.”
VPM News reached out to the senators sponsoring the proposal for comment, but they were not made available before this story was published.
Possible Medicaid cuts
President Donald Trump has committed to making $2 trillion of federal spending cuts and tapped entrepreneur Elon Musk, and former Republican presidential candidate and businessman Vivek Ramaswamy to run an advisory body called the Department of Government Efficiency. The group’s expected to propose federal cost saving measures, though DOGE has “no official authority.” Musk has expressed doubt in the nongovernment group’s ability to meet its cost-cutting goals.
Medicare spending is one of the top areas of focus for Republicans at the federal level. A memo reported by Politico outlines $2.3 trillion in cuts to Medicaid being considered by Republicans — who control both chambers of Congress and the executive branch as of Monday.
Nearly 2 million Virginians receive health care coverage through Medicaid or the state’s child health insurance program, FAMIS. Of those, about 636,000 people rely on Virginia’s Medicaid expansion.
The state legislature passed Medicaid expansion with bipartisan support in 2018 under Gov. Ralph Northam, a Democrat. The trigger law and the hospital tax were included in budget language at the time to garner support from the legislature — which had a Republican-controlled House of Delegates and Democrat-led Senate.
Virginia is one of nine states with trigger laws that go into effect if federal funding for Medicaid falls below 90%.
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