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On February 12, 2025, House Budget Committee Chair Jodey Arrington released the House Republican budget plan aimed at reducing federal spending and lowering the national debt.
The plan seeks to cut trillions of dollars over the next decade by reducing funding for safety net programs like Medicaid and Medicare while increasing defense spending and pushing for tax reforms. If passed, parts of the proposal could move forward through the reconciliation process, a fast-track method that allows certain changes to pass the Senate with a simple majority (more than half the votes).
For family caregivers, the biggest concern is the proposed $880 billion cut to Medicaid, which could impact essential services. This article will break down what these spending cuts might include, how they could affect Medicaid programs, and what caregivers should watch for in the months ahead.
The House budget instructs the Energy & Commerce Committee to find at least $880 billion in Medicaid savings. To reach this goal, lawmakers are considering several policy changes that could make it harder for people to qualify for Medicaid or reduce the amount of federal funding states receive.
One proposal would require Medicaid recipients to meet work, education, or volunteer requirements to keep their coverage. Another idea is to lower the federal government's share of Medicaid spending, which could force states to cut services or tighten eligibility rules. Lawmakers are also looking at limiting supplemental payment programs, which help states get extra Medicaid funding without increasing their own spending.
One option that seems less likely—but is still possible—is a per-capita cap on Medicaid funding, which would cut more than $900 billion over ten years. If Congress moves forward with any of these aggressive spending cuts, Medicaid could change in ways that affect millions of people.
One of the biggest changes being considered is a work requirement for Medicaid recipients. This policy would require adults to meet certain work, education, or volunteer requirements to keep their coverage. According to the Congressional Budget Office (CBO), this change could save $109 billion but would also result in 1.5 million people losing Medicaid.
Another proposal would reduce the federal government's share of Medicaid funding, known as the Federal Medical Assistance Percentage (FMAP). Right now, states that expanded Medicaid under the Affordable Care Act (ACA) receive a 90% FMAP, meaning the federal government covers most of the cost. If this rate is lowered, states might have to cut services, tighten eligibility rules, or reduce payments to healthcare providers.
Lawmakers are also considering cutting supplemental payment programs, which help states get extra Medicaid funds. Limiting these programs could save $175 billion over ten years but may leave states with fewer resources to support Medicaid services.
Many Medicaid recipients qualify for the program through disability or strict income limits under traditional Medicaid rules, which existed before the Affordable Care Act (ACA) expansion. The ACA expansion allowed states to cover more low-income adults, with the federal government covering 90% of the costs for expansion enrollees. However, many Medicaid waivers and disability-based programs are funded under traditional Medicaid rules, not expansion.
Because the proposed budget cuts target Medicaid expansion and federal matching rates, traditional Medicaid groups (like those qualifying due to disability or very low income) may not see immediate, direct cuts to their eligibility.
However, if states receive less Medicaid funding overall, they may still have to cut services, increase wait times for Medicaid waivers, or tighten eligibility rules. This could make it harder for caregivers to access essential support, such as home health aides, medical supplies, or respite care.
At the same time, budget pressures may push states to explore more cost-effective care options. Programs like structured family caregiving, where Medicaid pays family members to care for loved ones, can save states around $60,000 per participant each year. If Medicaid funding is reduced, some states may expand these types of programs as a cost-saving measure.
The House Republican budget is a proposal, not a final decision. As of February 14, 2025, the House Budget Committee has approved the budget resolution, advancing it to the full House for consideration.
For the budget proposal to take effect, the full House must debate and vote on the budget resolution. If approved by the House, it moves onto the Senate Budget Committee for review before a final Senate vote, where it requires a majority vote for passage. Once both chambers of Congress approve the budget, it is presented to President Donald Trump for his signature to become law.
While the budget resolution sets the fiscal framework for federal spending, it does not have the force of law until specific appropriations bills are enacted.
Family caregivers should keep an eye on specific proposals in the coming months, especially any efforts to introduce work requirements, reduce Medicaid's federal match rate, or limit funding programs. State-level changes could also follow if federal funding decreases.
There is no immediate reason for concern, but it's important to stay informed. Caregivers can also advocate for Medicaid-supported services to ensure families continue receiving the care they need.
