As Congress wrestles with the future of Medicaid funding, ASCs, physicians and hospitals nationwide are bracing for potential financial turmoil.
Currently, the federal government covers 90% of costs for Medicaid expansion enrollees in the 41 states (including Washington, D.C.) that have adopted the Affordable Care Act’s expansion. However, proposed changes from House Republicans could significantly alter this arrangement. The proposals include implementing per capita spending limits, introducing work requirements, and reducing the enhanced Federal Medical Assistance Percentage from 90% to each state’s standard Medicaid matching rate, which ranges between 50% and 74%.
A report released on March 11 by the Urban Institute and the Robert Wood Johnson Foundation examined the potential consequences of these funding reductions on Medicaid expansion programs.
Here are six things to know:
1. If all 41 expansion states were to roll back Medicaid eligibility due to federal funding cuts, nearly 11 million individuals would lose health coverage.
2. Hospitals are projected to face the steepest financial losses, with an estimated $31.9 billion revenue drop in 2026 alone.
3. The burden of unpaid medical bills would rise by $6.3 billion.
4. Office-based physician services could see $6.4 billion in lost funding.
5. Other healthcare sectors — including dental care, home healthcare and services from nonhospital providers — could experience a $20.7 billion reduction in spending.
6. Here are the states that would suffer the most if the cuts are implemented:
| State | Current Hospital Spending ($B) | 2026 Without Medicaid Expansion ($B) | Difference ($B) | Change (%) |
| Indiana | 17.27 | 15.56 | -1.71 | -9.9% |
| New Mexico | 5.27 | 4.76 | -0.51 | -9.7% |
| Oregon | 11.6 | 10.5 | -1.10 | -9.5% |
| North Dakota | 1.82 | 1.67 | -0.15 | -8.1% |
| New York | 51.54 | 47.51 | -4.03 | -7.8% |
| Arizona | 17.7 | 16.33 | -1.37 | -7.7% |
| Louisiana | 10.67 | 9.95 | -0.73 | -6.8% |
| Oklahoma | 9.73 | 9.07 | -0.66 | -6.8% |
| North Carolina | 28.62 | 26.71 | -1.92 | -6.7% |
| Washington | 18.87 | 17.68 | -1.19 | -6.3% |
