Proposed Medicaid Cuts Could Jeopardize Healthcare for Millions in Michigan

Last updated Apr 15, 2025

TL/DR –

Proposed federal cuts to Medicaid could jeopardize the health coverage of over 2.6 million people in Michigan, raising the cost of care for everyone, according to elected leaders and healthcare officials. Medicaid, which provides health insurance to low-income individuals and families, those with disabilities, and others, is funded by the federal government, and Michigan receives billions of dollars each year to administer the program. The potential cuts, which could sum to $880 billion over the next decade, were included in a budget framework approved by House Republicans and would result in healthcare cost increases, program cuts, and potential layoffs and closures in the healthcare industry.

Proposed Medicaid Cuts Threaten Michigan Healthcare

The proposed federal Medicaid cuts could threaten the healthcare of over 2.6 million Michigan residents and increase healthcare costs overall, according to elected leaders and healthcare officials. Critics describe the proposed cuts, currently under consideration by the federal legislature, as an “assault on what people need to be healthy.”

Lt. Gov. Garlin Gilchrist, who recently convened a roundtable with elected leaders, healthcare officials, and veteran advocates at Corewell Health Blodgett Hospital, voiced his grave concern. He highlighted the potential consequences of cutting Medicaid by up to $880 billion over the next decade.

These cuts were included in the 2026 budget framework, which was narrowly approved by House Republicans, as reported by The Hill. Federal lawmakers will now begin turning the framework into a budget bill for final approval.

Medicaid, a program for low-income individuals, families, and people with disabilities, receives billions of dollars each year from the federal government. In Michigan alone, the funding reached nearly $17.5 billion in 2023.

While Democratic members of Michigan’s House delegation voted against the budget framework, all Republicans voted in favor. Critics warn that Michigan’s Congressional Republicans are putting their citizens at risk by supporting these cuts.

Officials also caution that Medicaid cuts could lead to higher healthcare costs for all, program cutbacks, and potential layoffs and closures in the healthcare industry, such as Medicaid-funded nursing facilities.

Chad Tuttle, Corewell Health interim Chief Operating Officer, explains that if people lose access to preventative care and end up requiring hospital treatment, this will increase costs for others, as these expenses need to be offset.

Despite the potential Medicaid cuts, Tuttle confirmed that Corewell Health, Michigan’s largest hospital system, isn’t discussing possible closures or layoffs yet.

The spending framework directs the House Committee on Energy and Commerce to cut $880 billion from the spending it oversees over the next decade, with Medicaid under its jurisdiction. Although Medicaid isn’t explicitly targeted, the nonpartisan Congressional Budget Office stated that cuts of this magnitude would require reductions to Medicaid.

House Speaker Mike Johnson, R-Louisiana, asserted cuts would primarily target fraud and inefficiencies. President Donald Trump pledged to protect Medicaid funding, while some Republican representatives said they would not support a budget bill that cuts Medicaid.

U.S. Rep. Hillary Scholten, D-Grand Rapids, believes there is still time for federal lawmakers to reverse course before the final budget bill is approved, arguing that taking healthcare from needy and deserving individuals is not the way to achieve fiscal responsibility.

Both Gilchrist and State Rep. Phil Skaggs, D-East Grand Rapids, discussed the possibility of engaging the philanthropic community for financial assistance if Medicaid is significantly cut. However, they agree that the best solution is not to make the cuts in the first place.

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