Governors eye Medicaid cuts to ease COVID-19 budget pain

Governors facing huge budget shortfalls are eyeing cuts to Medicaid, even as millions of unemployed Americans flock to the health insurance program after losing their employer-based coverage. States that are buckling under declining revenues and increased Medicaid enrollment due to COVID-19 say they may have no choice but to cut the program for the poor unless they get more financial support from the federal government.

“These are cuts that can be triggered and eliminated with the stroke of a pen," California Gov. Gavin Newsom (D) said Thursday about cuts to Medicaid and other programs that will go in effect July 1 without help from Congress and President Trump.

Federal law requires states to balance their budgets, and during economic downturns, governors and state legislatures tend to cut costly programs like Medicaid. States as a whole could face budget shortfalls of $500 billion, according to one analysis by a University of Pennsylvania professor, meaning cuts could be particularly steep this time around.

Medicaid consumes about 20 percent of state budgets, with spending on the program spiking during recessions as more Americans sign up after losing their jobs.

https://thehill.com/policy/healthcare/medicaid/498097-governors-eye-medicaid-cuts-to-ease-covid-19-budget-pain