Key Takeaways
- Medicaid cuts could eliminate critical home-based care for seniors and people with disabilities.
- States may be forced to reduce services or restrict eligibility if federal funding is slashed.
- Rural hospitals and care workers are especially vulnerable to budget shortfalls.
- Divisions within the Republican Party may influence how much is ultimately cut.
Medicaid Cuts Threaten Home Care and Nursing Services for Millions of Seniors
As Congress debates $880 billion in proposed Medicaid cuts, healthcare providers and senior advocates warn that these reductions could severely impact older adults, people with disabilities, and rural communities. Medicaid helps fund critical services like home care and nursing homes, which are now at risk.
The Republican-led budget resolution, now in the Senate, aims to reduce federal spending to help offset $4.5 trillion in new tax cuts supported by the Trump administration. However, health experts and lawmakers argue that these deep Medicaid cuts could overwhelm state budgets and threaten care for millions of Americans.
What Medicaid Covers — and Why It Matters
Medicaid is a joint state-federal program that provides health coverage to more than 72 million Americans. This includes children, low-income adults, seniors, and individuals with disabilities. Unlike Medicare, Medicaid pays for long-term care—including in-home support and nursing facility stays.
“Many of my patients would die at home without Medicaid,” said Dr. Fred Levin of Community PACE in Newaygo, Michigan. “They depend on this program for transportation, medication, and even basic hygiene support.”
His PACE center helps older adults live safely at home instead of moving to nursing facilities. If funding is cut, he fears the center will close, leaving patients with no alternatives in rural areas.
States Face Major Burden if Medicaid Is Cut
If the federal government reduces Medicaid funding, states will have to pick up the cost. Most states already face tight budgets. As a result, they may cut benefits, limit eligibility, or end certain programs altogether.
“States typically cut optional services like home-based care first,” explained Natalie Kean of Justice in Aging. “That’s the area most at risk if funding drops.”
Many seniors rely on in-home aides for cooking, bathing, and other daily tasks. These services, while more cost-effective than nursing homes, are expensive. The median annual cost for a full-time home aide is $62,400, well above the $36,000 median income for seniors.
| Long-Term Care Costs (2021) | Annual Cost |
|---|---|
| Home Health Aide | $38,000 |
| Nursing Home (Private Room) | $54,000 |
Without Medicaid, most older Americans can’t afford these services on their own. In fact, Medicare and private insurance generally do not cover long-term care.
Republicans Divided Over Medicaid Funding
While some Republicans support cutting Medicaid to control spending, others are pushing back. Several GOP senators warn that the proposed cuts could harm their constituents and damage healthcare systems in rural areas.
- Sen. Susan Collins (R-ME) opposes any cuts that would affect care for over 400,000 Mainers on Medicaid.
- Sen. Jerry Moran (R-KS) stressed that Medicaid is vital for rural hospitals, which already operate on slim margins.
- Sen. Josh Hawley (R-MO) said 21% of his state’s residents rely on Medicaid or CHIP and urged President Trump to protect benefits.
In response, Trump reportedly assured Hawley that “Medicaid benefits will not be cut.” However, experts argue that the math in the House-passed budget plan doesn’t work unless Medicaid spending is reduced significantly.
Home-Based Care and Workforce at Risk
One of the first areas likely to be affected is home and community-based care, which federal law does not require states to cover. These services include home health aides, transportation, and adult day care.
Because these programs are optional, states can easily scale them back or eliminate them during budget crises. That would shift the financial burden to families and put further pressure on an already strained direct care workforce.
“Even if services stay in place, we may not have enough workers to deliver care,” Kean warned. “That puts patients at risk.”
In the last two years, many states increased Medicaid payment rates to attract and retain long-term care workers. Federal cuts could reverse that progress.
What’s Next in the Senate
Senate Republicans recently passed an amendment stating they support “strengthening” Medicaid. But many lawmakers and policy analysts say the $880 billion in deficit reduction goals can’t be met without major Medicaid cuts.
Some GOP senators remain committed to finding alternative savings. However, divisions within the party—and between the House and Senate—make the path forward uncertain.
Sen. Lindsey Graham (R-SC), who leads the Senate Budget Committee, insists the budgeting approach is legal and necessary. Yet moderate Republicans are pushing for amendments that protect Medicaid, even if it means conflicting with House priorities.
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