US HOUSE SPEAKER Mike Johnson sent signals Tuesday about the approach his caucus will take to Medicaid as it works this month to craft a budget bill that is expected to seek $1.5 trillion in savings to pay for President Donald Trump’s domestic policy and tax cut agenda.
After meeting with moderate Republicans who have been hesitant to go along with conservatives’ ideas to make significant changes Medicaid, The Hill said Johnson told reporters Tuesday that the bill his chamber puts forward will not change the Federal Medical Assistance Percentage (FMAP) rate, the portion of state Medicaid costs paid by the federal government, for states that have expanded Medicaid, like Massachusetts.
Johnson also said the House GOP plan will probably not seek to implement per capita caps on Medicaid benefits for enrollees in expansion states, though he told The Hill and others to “stay tuned.”
Changes to FMAP and per capita caps are among the policy ideas being watched closely by Beacon Hill. Cuts in Medicaid would ripple through MassHealth, the largest single chunk of spending in the state budget and a program that affords health care coverage to about 2 million Bay Staters. Under Gov. Maura Healey’s budget plan, federal reimbursement for MassHealth spending was expected to increase by $1.8 billion to $14.2 billion in fiscal 2026.
Nearly every dollar in MassHealth spending is reimbursed by at least 50 percent in federal revenue, with expenditures from the Children’s Health Insurance Program reimbursed at 65 percent and expenditures for the state’s Medicaid expansion reimbursed at 90 percent.
An analysis from KFF found that MassHealth enrollment would drop by 391,000 people or 19 percent over 10 years if the 90 percent match rate for the expansion population were ended. If Massachusetts wanted to cover the federal share, it would have to increase state spending by $15 billion over 10 years.
Switching from the current FMAP reimbursement structure to one in which Medicaid is funded through per capita spending caps or block grants was seen as a way to shift costs from the federal government to state.
The Hill reported Tuesday that House Republicans are aiming to get a budget bill through the chamber by Memorial Day, but also called that “an ambitious timeline that is on thin ice amid a host of key policy disagreements — including those surrounding Medicaid.” The U.S. House Energy and Commerce Committee, which is supposed to find $880 billion in savings and has jurisdiction over Medicaid, delayed its vote on its crucial portion of the budget bill until next week, the outlet reported.
Johnson made clear Tuesday that a proposal to impose new work requirements on healthy adults in Medicaid expansion states like Massachusetts in order to keep the 90 percent match rate is still in play.
“That will be part of the bill, it always has been,” Johnson said Tuesday.