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Trump's Budget Bill Will Likely Force States to Cut Medicaid Payments to Doctors and Hospitals by More Than $50 Billion a Year. 76 Republicans We Track From the Hardest-Hit States Voted for It.

A new Health Affairs analysis finds the 2025 budget bill's limits on Medicaid payments will likely force three dozen states to cut what they pay doctors and hospitals by more than $50 billion a year, starting in 2028. Fewer providers are likely to take Medicaid patients. These 76 Republicans on our report cards, from the 15 states facing the biggest cuts, voted yes.

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Trump's Budget Bill Will Likely Force States to Cut Medicaid Payments to Doctors and Hospitals by More Than $50 Billion a Year. 76 Republicans We Track From the Hardest-Hit States Voted for It.

If you're on Medicaid, finding a doctor who will see you is about to get harder.

Trump's 2025 budget bill caps how much states can pay doctors and hospitals through Medicaid. A new peer-reviewed analysis in Health Affairs estimates those caps will likely force three dozen states to cut their yearly Medicaid payments to providers by a total of more than $50 billion, Stateline reported on September 24, 2026.

"It's going to make it more difficult for people who are on Medicaid to get essential care," said Debra Lipson, the health policy researcher who wrote the analysis.

What the law does

Medicaid already pays doctors and hospitals less than private insurance or Medicare for the same care. That's why many doctors won't take Medicaid patients.

Since 2016, the federal government has let states fix part of that gap. States that run Medicaid through private managed-care companies can require those companies to pay providers more for certain care. Spending on these extra payments grew from about $27 billion in 2020 to an estimated $143 billion in 2025.

The budget bill Trump signed in July 2025 clamps down on them. Starting in 2028, states must cut these payments by 10 percentage points a year until they fall to what Medicare pays — or 110% of Medicare in states that didn't expand Medicaid. States that expanded Medicaid under the Affordable Care Act get the lower cap.

Supporters call the payments a windfall for hospitals. Lipson's analysis says the cuts will widen the gap between what Medicaid pays and what care actually costs. The 17 states with the highest payment rates will have to cut Medicaid spending by 10% to 25% of their whole Medicaid budgets.

Who gets hurt

When Medicaid stops covering the cost of care, providers see fewer Medicaid patients. "More of these hospitals, (and) a few nursing homes that are wrapped up in our academic medical centers, are going to start limiting the numbers of Medicaid patients that they see," Lipson said.

And people with private insurance could pay too. Lipson suggests hospitals may try to make up the losses by charging commercial insurers more — which shows up in everyone else's premiums.

The analysis named 15 states that will face the biggest cuts: Nebraska, Louisiana, South Carolina, Iowa, Nevada, Arizona, Kentucky, New Mexico, Illinois, Tennessee, Florida, Georgia, North Carolina, Michigan and Mississippi. Each spent more than 20% of its 2024 Medicaid budget on these payments, at or near what commercial insurers pay.

Who voted for it

The House passed the final version of the budget bill 218 to 214 on July 3, 2025. The Senate passed it on July 1 after a 50–50 tie that Vice President JD Vance broke.

These 76 Republicans on our report cards who are still on the ballot represent the 15 hardest-hit states and voted yes (all in the House unless marked):

Several are now running for higher office. Byron Donalds, Andy Biggs and John James are running for governor. Ashley Hinson, Andy Barr and Julia Letlow are running for the Senate.

They were warned

This isn't the first warning. In Kentucky, when Governor Andy Beshear said 35 rural hospitals were at risk from the bill, Andy Barr demanded he prove it — pointing out the hospitals were still open, a year after a bill whose Medicaid cuts had barely begun. In Colorado, nurses have named 12 hospitals at risk. The Health Affairs analysis shows where the next blow lands: the payments that keep hospitals willing to see Medicaid patients at all.

The cuts don't start until 2028 — after this November's election. Voters in these 15 states get to weigh in before they do.

What the analysis shows

Trump's 2025 budget bill will likely force three dozen states to cut Medicaid payments to doctors and hospitals by more than $50 billion a year starting in 2028, according to a Health Affairs analysis, likely making it harder for Medicaid patients to find care. The 15 states facing the deepest cuts include Florida, Georgia, North Carolina, Michigan and Tennessee — and 76 Republicans we track from those states voted for the law.

Sources

Photo: Dana DiFilippo/New Jersey Monitor, via States Newsroom.

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