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The Trump administration has ordered states to investigate certain individuals enrolled in Medicaid to determine whether they are ineligible because of their immigration status, with five states reporting they’ve together received more than 170,000 names — an “unprecedented” step by the federal government that ensnares the state-federal health program in the president’s immigration crackdown.
Advocates say the push burdens states with duplicative verification checks and could lead people to lose coverage just for missing paperwork deadlines. But the administrator of the Centers for Medicare & Medicaid Services, Mehmet Oz, said in a post on the social platform X on Oct. 31 that more than $1 billion “of federal taxpayer dollars were being spent on funding Medicaid for illegal immigrants” in five states and Washington, D.C.
Medicaid’s overall spending topped $900 billion in fiscal year 2024.
It wasn’t clear from Oz’s statement or an accompanying video over what period the spending happened, and CMS spokespeople did not immediately respond to questions, either for an earlier version of this article or after Oz’s statement was posted.
Only U.S. citizens and some lawfully present immigrants are eligible for Medicaid, which covers low-income and disabled people and the closely related Children’s Health Insurance Program. Those without legal status are ineligible for federally funded health coverage, including Medicaid, Medicare, and plans through the Affordable Care Act marketplaces.
Several states disputed Oz’s comments.
“Our payments for coverage of undocumented individuals are in accordance with state and federal laws,” said Marc Williams, a spokesperson for Colorado’s Department of Health Care Policy & Financing, which administers the state’s Medicaid program. “The $1.5 million number referenced by federal leaders today is based on an incorrect preliminary finding, and has been refuted with supporting data by our Department experts.”
He added: “It is disappointing that the administration is announcing this number as final when it is clearly overstated and the conversations are very much in the education and discussion phase.”
Illinois Medicaid officials blasted Oz’s comments.
“Once again, the Trump administration is spreading misinformation about standard uses of Medicaid dollars,” said Illinois Medicaid spokesperson Melissa Kula. “This is not a reality show, and there is no conspiracy to circumvent federal law and provide ineligible individuals with Medicaid coverage. Dr. Oz should stop pushing conspiracy theories and focus on improving health care for the American people.”
The Washington State Health Care Authority, which runs the state’s Medicaid program, was also blunt.
“The numbers Dr. Oz posted on social media today are inaccurate,” said spokesperson Rachelle Alongi. “We were very surprised to see Dr. Oz’s post, especially considering we continue to work with CMS in good faith to answer their questions and clear up any confusion.”
In August, CMS began sending states the names of people enrolled in Medicaid that the agency suspected might not be eligible, demanding state Medicaid agencies check their immigration status.
KFF Health News in October reached out to Medicaid agencies in 10 states. Five provided the approximate number of names they had received from the Trump administration, with expectations of more to come: Colorado had been given about 45,000 names, Ohio 61,000, Pennsylvania 34,000, Texas 28,000, and Utah 8,000. More than 70 million people are enrolled in Medicaid.
Most of those states declined to comment further. Medicaid agencies in California, Florida, Georgia, New York and South Carolina refused to say how many names they were ordered to review or did not respond.
Oz said in his X post that California had misspent $1.3 billion on care for people not eligible for Medicaid, while Illinois spent $30 million, Oregon $5.4 million, Washington state $2.4 million, Washington, D.C., $2.1 million, and Colorado $1.5 million.
“We notified the states, and many have begun refunding the money,” he said. “But what if we had never asked?”
Washington, D.C.’s Medicaid director, Melisa Byrd, said CMS had identified administrative expenses for the district program that covers people regardless of immigration status that should not have been billed to the federal government and her agency has already fixed some of those areas. “We run a big program that is very complex and when mistakes or errors happen, we fix them,” she said.
The program plans to pay $654,014 back to CMS by mid-November.
All five states, plus Washington, D.C., are led by Democrats, and President Donald Trump didn’t win any of them in the 2024 election.
In recent days, Deputy Health and Human Services Secretary Jim O’Neill began posting pictures on X of people he said are convicted criminals living in the U.S. without authorization who had received Medicaid benefits.
O’Neill could not be reached for comment.
“We are very concerned because this seems, frankly, to be a waste of state resources and furthers the administration’s anti-immigrant agenda,” said Ben D’Avanzo, senior health advocacy strategist with the National Immigration Law Center, an advocacy group. “This duplicates what states already do,” he said.
As part of the administration’s crackdown on people in the U.S. without authorization, President Donald Trump in February directed federal agencies to take action to ensure they are not obtaining benefits in violation of federal law.
In June, advisers to Health and Human Services Secretary Robert F. Kennedy Jr. ordered CMS to share information about Medicaid enrollees with the Department of Homeland Security, drawing a lawsuit by some states alarmed that the administration would use the information for its deportation campaign against unauthorized residents.
In August, a federal judge ordered HHS to stop sharing the information with immigration authorities.
State Medicaid agencies use databases maintained by the Social Security Administration and Department of Homeland Security to verify enrollees’ immigration status.
If states need to go back to individuals to reverify their citizenship or immigration status, it could lead some to fall off the rolls unnecessarily — for example, if they don’t see a letter requesting paperwork or fail to meet a deadline to respond.
“I am not sure that evidence suggests there really is a need for this” extra verification, said Marian Jarlenski, a health policy professor at the University of Pittsburgh School of Public Health.
Oz made clear that the Trump administration disagrees.
“Whether willful or not, the states’ conduct highlights a terrifying reality: American taxpayers have been footing the bill for illegal immigrants’ Medicaid coverage, despite many Democrats and the media insisting otherwise,” Oz said in his X post.
In an August press release, CMS said it would ask states to verify eligibility for enrollees whose immigration status could not be confirmed via federal databases. “We expect states to take quick action and will monitor progress on a monthly basis,” the agency said.
Leonardo Cuello, a research professor at Georgetown University’s Center for Children and Families, called the CMS order to states “unprecedented” in the Medicaid program’s 60-year history.
He said the federal government may have been unable to verify certain individuals’ immigration status because names were misspelled or outdated, such as when a beneficiary is identified by their maiden instead of married name. The names may also include people helped by Emergency Medicaid, a program that covers the cost of hospital emergency services, including labor and delivery, for people regardless of immigration status.
“CMS is conducting pointless immigration status reviews for people whose hospital bills were paid by Emergency Medicaid,” Cuello said.
Oz noted in his post that federal law “does permit states to use Medicaid dollars for emergency treatment, regardless of patients’ citizenship or immigration status,” and that states can “legally build Medicaid programs for illegal immigrants using their own state tax dollars, so long as no federal tax dollars are used.”
The states Oz mentioned all run their own such programs.
The verification checks create an added burden for state Medicaid agencies that are already busy preparing to implement the tax and policy law Trump signed in July. The measure, which Republicans call the One Big Beautiful Bill Act, makes many changes to Medicaid, including adding a work requirement in most states starting by 2027. The law also requires most states to more frequently check the eligibility of many adult Medicaid enrollees — at least twice a year.
“I fear states may do unnecessary checks that create a burden for some enrollees who will lose health coverage who should not,” Cuello said. “It’s going to be a whole lot of work for CMS and states for very little pay dirt.”
Cuello said the effort may have “greater political value than actual value.”
Brandon Cwalina, a spokesperson for the Pennsylvania Department of Human Services, which runs Medicaid in the state, said the state already requires every Medicaid applicant to verify their citizenship or, where applicable, their eligible immigration status.
However, he said, the directive issued by CMS “constitutes a new process, and DHS is carefully reviewing the list in order to take appropriate actions.”
Oz did not name Pennsylvania, which Trump won in 2024, in his post.
If a lawful resident does not have a Social Security number, the state confirms their legal status by checking a database from Homeland Security, as well as verifying specific immigration documents, he said.
Other state Medicaid agencies said they also needed to regroup before reaching out to enrollees.
“Our teams just received this notice and are working through a process by which we will perform these reviews,” Jennifer Strohecker, then Utah’s Medicaid director, told a state advisory board in August.
Renuka Rayasam and Rae Ellen Bichell contributed reporting.
This article first appeared on KFF Health News.
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Hundreds of thousands of Minnesotans are facing sticker shock as the enrollment period for health insurance on the state marketplace opened Nov 1.
The increase is in large part due to the expiration of the Affordable Care Act — or “Obamacare” — tax credits, as well as changes in Medicaid reimbursement under President Trump’s “Big Beautiful Bill.”
The battle over tax credits and Medicaid reimbursements is at the heart of the federal government shutdown. Democrats have refused to vote yes on re-opening the government until credits and payments are restored.
Republicans say they want to negotiate the health insurance subsidies separately, and only pass what they call a “clean resolution.”
The premium increases are staggering for Minnesotans, and affect those who are purchasing their health insurance on the state-backed MnSure website.
There are 187,000 Minnesotans who buy individual policies through MnSure, and the average increase is 22%. Another 202,000 Minnesotans covered by small group plans through MnSure will see an average increase of 14%.
State Commerce Commissioner Grace Arnold, who oversees insurance rates, and MnSure CEO Libby Caulum spoke with WCCO’s Esme Murphy on WCCO Sunday Morning at 10:30 a.m. Both blame the federal government showdown for the increases.
“The expectation for insurers is that fewer people will have coverage,” Arnold said. “The people who tend to stay in coverage are sicker.”
There is a big difference in companies’ increases. On the individual market, Medica has the biggest increase at 30%, while Quartz Health Plan is the smallest at 7%.
“You can come to our website, MnSure.org, look at all those options. You can switch plans if you find a better deal for you and your family,” Caulum said.
The enrollment period is from Nov. 1, 2025, to Jan. 15, 2026. If you want benefits starting Jan. 1, 2026, you need to enroll by Dec. 15, 2025. Otherwise, your coverage will start on Feb. 1, 2026.
You can watch WCCO Sunday Morning with Esme Murphy and Adam Del Rosso every Sunday at 6 a.m. and 10:30 a.m.
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Esme Murphy
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In the last budget that Gov. Jared Polis will usher through from conception to enactment, the term-limited Democrat hopes to wrestle down ever-rising Medicaid costs, he said Friday in unveiling his proposal.
It’s a plan that proposes clamping down on dental benefits, requiring prior authorization for more services and making payment changes affecting home health services. Elsewhere, Polis hopes to revive his often-proposed — and never accepted by the legislature — idea of privatizing Pinnacol Assurance, the state’s workers’ compensation insurance program, to generate hundreds of millions of dollars.
Medicaid, which provides health insurance to low-income Coloradans, has been gobbling an ever-bigger chunk of the overall state budget for years. It’s growing at a rate that’s double the overall spending growth allowed by the Taxpayer’s Bill of Rights, or TABOR.
If left unchecked, Medicaid costs could end up dwarfing all other spending in the state in the next 15 years, leaving almost no money for any services that aren’t directly related to education or health care, according to the governor’s office.
“This gets worse if we don’t fix it,” Polis said Friday.
The governor’s overall budget proposal for the 2026-27 fiscal year includes a total spending request of more than $50.6 billion, up from $48 billion in the current fiscal year, which goes through June 30. Most of that is already spoken for as pass-through spending or other obligations.
The general fund, which covers most day-to-day spending, would grow from about $18.2 billion to $18.6 billion under Polis’ proposal.
Polis’ announcement of his proposal represents a starting point for the state’s next spending plan, which will cover July 1, 2026, through June 30, 2027. He will unveil an amended proposal in January as the state updates economic projections.
Then the legislature will have its say, starting with the powerful Joint Budget Committee.
Four of the committee’s six members are seeking higher office in the 2026 election, making this budget an even more pitched-than-usual declaration of political values. The legislature will vote on the final budget in the spring.
Early forecasts have the body needing to make up a nearly $1 billion gap — again — between planned spending and what the state is allowed to spend under the growth cap set by TABOR. This tight budget year follows an August special session where lawmakers needed to fill a $783 million hole opened up in the current fiscal year by federal tax changes signed into law by President Donald Trump over the summer.
Polis said a key hope of his budget proposal is to bring growth in Medicaid spending in line with the overall growth in state spending allowed by TABOR. Over the past decade, the state constitution has limited total state spending to growth by an average 4.4% per year.
Medicaid spending has grown at double that rate, 8.8%. In that period, general fund spending on Medicaid has grown from about $2.4 billion $5.5 billion per year.
In his proposal, Polis would increase state Medicaid spending by about $300 million. That increase alone represents more spending than several executive agencies’ combined budgets — but would still be half as steep as Medicaid’s projected growth without changes to the program.
Polis said he wants to lower overall spending on Medicaid services without touching how much individual providers are paid for services. Proposed changes include annual caps of $3,000 on dental benefits, which Polis noted would be double the cap that existed in 2023; adding prior authorization to some services; and changing how payment is calculated for home health nursing and therapy services.
Several of those proposals are extensions of executive orders he issued to help shore up the most recent budget trouble in August.
“There have been a number of benefits that have been added (to Medicaid) in recent years, and some of those are not sustainable over time,” Polis said.
His administration has also been working with national consultants to examine how Colorado’s Medicaid spending has differed from national trends. That report should be available in the New Year.
In another key element of his proposal, Polis is looking to restart a fight from last year over converting the state’s quasi-governmental workers’ compensation insurance program to a fully private enterprise.
Polis’ office predicted the Pinnacol Assurance spin-off, if completed, would generate at least $400 million for the state. About half of that would go to pay for the homestead property tax exemption, while the rest would go to state maintenance and to balance the budget.
Pinnacol acts as an “insurer of last resort” for employers in high-risk industries. The firm is generally not allowed to refuse to insure employers or cancel policies, but it can operate only within Colorado’s borders.
Polis restarted the conversation last year with arguments that Pinnacol was hamstrung from competing in today’s markets, where employers are less bound by state borders than ever. Turning the quasi-state agency into a private firm would also equal a payday for a cash-strapped state.
The effort petered out when the idea didn’t win much traction during the legislative session — though Polis hinted later that he hadn’t given up on the effort.
This year, Polis said the money would help the state keep its property tax break for certain long-term homeowners, known as the homestead exemption. The tax break is usually paid for using the state’s TABOR surplus, but the state won’t have one this year, Polis said.
“Nearly every other state has moved in this direction for reasons that are very important to employees and employers,” Polis said. “For Pinnacol to be able to continue to serve as our insurer of last resort, we have to be able to allow them to write interstate business, to take some of the same steps that can reduce overhead and produce better value to employees that other states have done.”
Opponents to the move worry that taking Pinnacol private would weaken protections for workers and employers in the state. The insurer essentially acts as a social safety net for industries that otherwise couldn’t obtain coverage, they argued last year.
This year, opponents are warning that privatizing the insurer and taking a portion of the money — potentially hundreds of millions of dollars — would be unconstitutional because the money isn’t the state’s to take.
“Pinnacol’s assets were built from employer premiums, not tax dollars,” said Stephanie Tucker, an attorney and president of the Workers’ Compensation Education Association, in a statement. “These funds belong to the employers who paid premiums and (to) injured workers, not the state. Privatization without clear legal authority could result in years of litigation and uncertainty for both Pinnacol and the state of Colorado.”
State officials have a different interpretation. The state “has an obligation” to get value for Pinnacol if it’s spun off, Mark Ferrandino, the head of the Office of State Planning and Budgeting, said.
Polis said he’s been briefed on the legal question and his staff classified it as a “very low litigation risk.”
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Nick Coltrain
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The federal government shutdown has upended the lives of millions of Americans who rely on essential benefits disbursed by federal agencies. Principally among them is the Supplemental Nutrition Assistance Program (SNAP), which assists one in eight Americans who otherwise wouldn’t be able to put food on the table for themselves or their dependents. Now, the U.S. Department of Agriculture (USDA) has confirmed that due to the shutdown, the well has “run dry,” and no benefits will be issued starting Nov. 1. As a result of Washington’s failure to reach an agreement on fiscal priorities, millions of SNAP recipients who typically receive food dollars on the first of the month at the reset of EBT payments will be left without assistance. And even more Americans will pay the price.
The lowest 20 percent of earners will feel the blow most acutely, as the loss of benefits devastates their ability to access nutritionally sound and affordable food options. When food access disappears, so does nutritional stability, triggering ripple effects across health, education and local communities. As families’ resources for healthy meals diminish, and as some go without food entirely, these changes have the potential to exacerbate food insecurity and deteriorate overall public health outcomes. Without swift intervention, the disruption could spiral into a national health crisis.
Few Americans grasp the magnitude of SNAP’s reach or the economic engine it fuels. Over 40 million people, who are integral to our national and local economies, workforces, and communities, rely on SNAP. Every dollar spent in SNAP generates roughly twice that amount in local economic activity. When those dollars vanish, corner stores, grocers, farmers’ markets and food distributors all feel the squeeze. Those losses flow upstream into job cuts, supply chain disruptions and reduced consumer spending, an economic domino that affects Americans across income brackets.
The health consequences are just as serious. When households can’t access food, preventable illnesses and chronic conditions often worsen. The result is a surge in emergency room visits, mental health crises and avoidable hospitalizations. Many Americans living below the poverty line already struggle to stay engaged with their physician, pharmacy and other healthcare providers, and without food, will have even less of a reason to prioritize things like medication adherence, chronic condition management or other self-care behaviors. This will not only lead to worsened health outcomes, but could also threaten to overrun hospitals and force ER staff to turn down patients in need. That strain will reverberate through an already overburdened healthcare system, exacerbating workforce shortages and driving up costs for everyone.
Public health experts estimate that inequities tied to food insecurity already contribute billions in avoidable medical spending and productivity losses each year. If the shutdown persists, those numbers will balloon. In a volatile economy where every sector is struggling to preserve stability, the loss of a cornerstone program like SNAP threatens to erode both pubic health and national productivity.
These Inequities also contribute to a broader economic drag: poor health outcomes significantly contribute to healthcare spending and lost Gross Domestic Product (GDP), which accounts for approximately 20 percent of the total cost of healthcare. Not only will this cost our healthcare system billions of dollars, but the crisis carries a human toll, costing individuals their dignity and many communities’ financial stability, as local grocers, farmers and other small businesses face collateral damage.
The pressure on low-income Americans is compounded by additional changes to SNAP and Medicaid set in motion by the One Big Beautiful Bill Act (OBBBA), passed in July, well before the government shutdown even began. The legislation stipulates that able-bodied, childless adults between 18 and 64 must work, attend school or perform at least 80 hours of community service per month to receive Medicaid and SNAP benefits. Although many people meet these requirements through their equivalent activity, the new processes that are both lengthy and tedious will disqualify millions from receiving benefits, as they lack the resources to understand, navigate and ensure compliance. While intended to encourage workforce participation, the policy’s complexity and documentation requirements are creating new administrative barriers that disproportionately affect those without stable access to transportation, childcare or digital tools.
When the shutdown finally comes to an end, the OBBBA will keep millions in bureaucratic limbo, perpetuating problems for those seeking not only food-related benefits but healthcare more broadly, again impacting the most vulnerable Americans. This type of legislation, which threatens to strip impoverished groups of their access to food resources, stands in direct opposition to the stated goals of Robert F. Kennedy Jr.’s Make America Healthy Again (MAHA) movement, which calls for policies that make nutritious, unprocessed foods more accessible.
With the shutdown and the onset of OBBBA, SNAP will be in flux for many, forcing those with limited resources to stretch their dollars on cheaper, more processed and less nutritious foods, exactly the opposite of what MAHA aims to achieve. This disconnect, along with the administration’s failure to address the root causes, further underscores its inability to recognize the broader impact that neglecting this population has on all its constituents.
Ultimately, it’s up to healthcare professionals, business leaders and the private sector to mobilize and step in where the public sector is falling short. Partnerships between food producers, health systems and nonprofits can sustain emergency distribution programs, while employers and insurers can invest in nutrition-support initiatives that reduce downstream costs. Millions of people are being left behind by SNAP cuts, and their well-being depends on our collective response. Communities that have long relied on federal support are now at a breaking point. If we allow communities to fall through the cracks, the damage won’t be confined to any one ZIP code. It will manifest in slower growth, sicker populations and a weakened economy. To preserve the health, dignity, and stability of our society, we need bold, sustainable and financially viable solutions that close these gaps once and for all.
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Cindy Jordan
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For some kids, the school nurse is there to put a bandage on a skinned knee or check for a fever. But for a majority of Black students, too often, that nurse is the only healthcare provider they’ll see all year. If House Republicans get their way, though, even that might disappear.
Indeed, Medicaid is the largest federal funding source for school-based health services. And with GOP lawmakers inching closer to passing the One Big Beautiful Bill Act, the health safety net it provides students could be ripped away.
The budget bill, a cornerstone of President Donald Trump’s domestic agenda, slashes at least $715 billion from Medicaid. That means school-based health services funded through Medicaid, such as speech therapy, occupational therapy, mental health counseling, and behavioral health care, could be greatly reduced or eliminated entirely.
“It would be unacceptable and unethical to take that away from our kids,” Lauren Reliford, policy director at the Children’s Defense Fund, tells Word In Black, “Cuts like these will be particularly harmful for children who live at the intersection of race, ethnicity, citizenship status, gender identity, and disabilities.”
According to the Economic Policy Institute, more than half of all Black children under age 19 rely on public health insurance like Medicaid. For some, this means coverage outside of school — doctor’s visits, prescriptions, and other care. But for many Black students in under-resourced schools, school is often the only place they can get health services at all.
Black students are more likely than their white peers to be enrolled in school-based Medicaid programs. In 2023, 51.2% of Black children received healthcare through these school-based health centers (SBHCs), compared to just 23.8% of white children.
SBHCs, which offer a range of services — including annual physicals, dental care, and mental health counseling receive federal Medicaid reimbursement to defray their operating costs. This is especially the case in low-income, majority-Black districtswhere students often qualify for public health insurance.
In a recent study published in the Research Journal of Adolescent Health,researchers noted that SBHCs “support children’s school function by addressing health concerns that might get in the way of students’ academic success without requiring them to leave campus and miss school.” Researchers also found that SBHCs are linked to improved GPAs and higher graduation rates.
A 2023 study conducted by The Los Angeles Trust for Children’s Health and partners found that students who got healthcare at school gained 5.4 to 7 additional school days of attendance per year. And in New York City, a study of school-based health centers found a positive correlation between access to health centers and student performance in English Language Arts (ELA).
If these services disappear, experts warn that Black students — who already face higher rates of school-based trauma and fewer support systems — risk being pushed further behind.
Meanwhile, districts are already bracing for the impact if the One Big Beautiful Bill Act becomes law. A March survey by the School Superintendents Association found that nearly 70% of district leaders anticipate having to cut school-based mental and behavioral health services if Medicaid is reduced or eliminated.
And for Black and Brown children, who are already often failed by the educational system, Reliford says taking away that care is not just negligent — it’s dangerous.
“Every child deserves access to healthcare for their body and mind,” she says, “This is an intolerable scenario that the nation’s lawmakers must do everything in their power to avoid. We must demand better for them — and from those in power.”
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Quintessa Williams, Word in Black and Word In Black
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A man has pleaded guilty to wire fraud in what federal prosecutors have called a “massive” scheme to defraud a Minnesota housing program, according to court documents filed Thursday.
Anwar Ahmed Adow pleaded guilty to one count of the charge. He was one of eight people who received millions in Medicaid money from Housing Stabilization Services, according to acting U.S. Attorney Joseph Thompson. The other seven have also been charged with wire fraud.
Housing Stabilization Services is a Medicaid program started in 2020 that aimed to help people with disabilities and addictions find and maintain housing, court records said. The program was under the umbrella of the Minnesota Department of Human Services and has previously been accused of being the target of widespread fraud.
According to the complaint, Adow was the owner and principal of Liberty Plus LLC in Roseville, Minnesota. The business was registered with the state “in or about” November 2022, documents said.
Adow and his employees were supposed to provide housing consulting, transitioning and sustaining services to qualifying people in need, according to court documents. In November 2024, Adow applied with the state for Liberty Plus to operate as a housing services provider and then told his employees to “bill as much as they could,” charges said. Adow said he “would not scrutinize” the billable hours his employees turned in to him.
“In this way, Adow incentivized his employees, who were paid hourly wages, to inflate their hours,” the complaint said.
Liberty Plus, based on “inflated and fraudulent claims,” received more than $1.2 million in Medicaid funds for services reportedly provided to around 200 people, charges said. Adow diverted much of that money to his co-conspirators and employees. He also spent some of the money on investments and to lease a 2023 Mercedes-Benz CLS, according to court documents.
Adow was initially charged on Sept. 18 with four counts of wire fraud. Thompson said at that time it was “just the first round of indictments” connected to HHS, and future charges will come in “waves.”
The state said it’s working to terminate the housing program altogether because it “does not have the necessary controls to stop bad actors.”
A sentencing date for Adow has not yet been scheduled.
Note: The above video first aired on Sept. 18, 2025.
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Nick Lentz
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Many states have been tightening Medicaid payouts and Bright Center in Manassas said anticipated continued cuts could result in it closing its doors.
Many states have been tightening Medicaid payouts and one adult day care in Northern Virginia said anticipated continued cuts could result in it closing its doors.
Bright Center in Manassas serves adults with disabilities, providing care for those with autism and intellectual and developmental disabilities while their caregivers are at work. President Sidikie Kamara started the program with his late wife and said the Medicaid reimbursement rate per participant has dropped from $75 to $65 per day since 2023.
“Just the overall cost of taking care of one individual — $65 is really just not enough,” Kamara said.
He said the drop wasn’t sudden. The rate went from $75 to $70, and then to $65 over the course of about a year.
Kamara said he’s had to cut staff and has spent over $200,000 of his own savings to keep the center open.
WAMU was first to report on the cuts and their impact on the center.
“We are really struggling just to stay open,” Kamara said.
He currently serves 18 students, down from nearly 40 before the cuts began.
“Providing the services that they need for our students, like buying food, going on outings … half of that comes from my own savings,” Kamara said.
He’s also worried that with steep cuts to Medicaid in the recently passed “One Big Beautiful Bill,” more reimbursement reductions could be coming.
Kamara said the day care is not just a community resource, it’s also one way he is keeping his wife’s memory alive.
“I don’t want to close this place,” he said. “The mission must continue.”
Kamara said he’s reached out to Virginia Medicaid, state delegates and others for help but hasn’t received a response. WTOP has also reached out to Virginia Medicaid for comment.
“I just can’t understand why you wouldn’t want to help,” he said. “This is for the community.”
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Mike Murillo
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ENGLEWOOD — Metro Denver budtender Quentin Ferguson needs Regional Transportation District bus and trains to reach work at an Arvada dispensary from his house, a trip that takes 90 minutes each way “on a good day.”
“It is pretty inconvenient,” Ferguson, 22, said on a recent rainy evening, waiting for a nearly empty train that was eight minutes late.
He’s not complaining, however, because his relatively low income and Medicaid status qualify him for a discounted RTD monthly pass. That lets him save money for a car or an electric bicycle, he said, either of them offering a faster commute.
Then he would no longer have to ride RTD.
His plight reflects a core problem of lagging ridership that RTD directors increasingly run up against as they try to position the transit agency as the smartest way to navigate Denver. Most other U.S. public transit agencies, too, are grappling with a version of this problem.
In Colorado, state-government-driven efforts to concentrate the growing population in high-density, transit-oriented development around bus and train stations — a priority for legislators and Gov. Jared Polis — hinge on having a swift public system that residents ride.
But transit ridership has failed to rebound a year after RTD’s havoc in 2024, when operators disrupted service downtown for a $152 million rail reconstruction followed by a systemwide emergency maintenance blitz to smooth deteriorating tracks that led to trains crawling through 10-mph “slow zones.”
The latest ridership numbers show an overall decline this year, by at least 3.9%, with 40 million fewer riders per year compared with six years ago. And RTD executives’ newly proposed, record $1.3 billion budget for 2026 doesn’t include funds for boosting bus and train frequency to win back riders.
Frustrations intensified last week.
“What is the point of transit-oriented development if it is just development?” said state Rep. Meg Froelich, a Democrat representing Englewood who chairs the House Transportation, Housing and Local Government Committee. “We need reliable transit to have transit-oriented development. We have cities that have invested significant resources into their transit-oriented communities. RTD is not holding up its end of the bargain.”
At a retreat this past summer, a majority of the RTD’s 15 elected board members agreed that boosting ridership is their top priority. Some who reviewed the proposed budget last week questioned the lack of spending on service improvements for riders.
“We’re not moving the needle. Ridership is not going up. It should be going up,” director Karen Benker said in an interview.
“Over the past few years, there’s been a tremendous amount of population growth. There are so many apartment complexes, so much new housing put up all over,” Benker said. “Transit has to be relied on. You just cannot keep building more roads. We’re going to have to find ways to get people to ride public transit.”
RTD Chief Executive and General Manager Debra Johnson, in emailed responses to questions from The Denver Post, emphasized that “RTD is not unique” among U.S. transit agencies struggling to regain ridership lost during the COVID-19 pandemic. Johnson blamed societal shifts.
“Commuting trends have significantly changed over the last five years,” she said. “Return-to-work numbers in the Denver metro area, which accounted for a significant percentage of RTD’s ridership prior to March 2020, remain low as companies and businesses continue to provide flexible in-office schedules for their employees.”
In the future, RTD will be “changing its focus from primarily providing commuter services,” she said, toward “enhancing its bus and services and connections to high-volume events, activity centers, concerts and festivals.”
A recent survey commissioned by the agency found exceptional customer satisfaction.
But agency directors are looking for a more aggressive approach to reversing the decline in ridership. And some are mulling a radical restructuring of routes.
Funded mostly by taxpayers across a 2,345 square-mile area spanning eight counties and 40 municipalities — one of the biggest in the nation — RTD operates 10 rail lines covering 114 miles with 84 stations and 102 bus routes with 9,720 stops.
“We should start from scratch,” said RTD director Chris Nicholson, advocating an overhaul of the “geometry” of all bus routes to align transit better with metro Denver residents’ current mobility patterns.
The key will be increasing frequency.
“We should design the routes how we think would best serve people today, and then we could take that and modify it where absolutely necessary to avoid disruptive differences with our current route map,” he said.
Then, in 2030, directors should appeal to voters for increased funding to improve service — funds that would be substantially controlled by municipalties “to pick where they want the service to go,” he said.
Reversing the RTD ridership decline may take a couple of years, Nicholson said, comparing the decreases this year to customers shunning a restaurant. “If you’re a restaurant and you poison some guests accidentally, you’re gonna lose customers even after you fix the problem.”
The RTD ridership numbers show an overall public transit ridership decrease by 5% when measured over the 12-month period from August 2024 through July 2025, the last month for which staffers have made numbers available, compared with the same period a year ago.
Bus ridership decreased by 2% and light rail by 18% over that period. In a typical month, RTD officials record around 5 million boardings — around 247,000 on weekdays.
The emergency maintenance blitz began in June 2024 when RTD officials revealed that inspectors had found widespread “rail burn” deterioration of tracks, compelling thousands of riders to seek other transportation.
The precautionary rail “slow zones” persisted for months as contractors worked on tracks, delaying and diverting trains, leaving transit-dependent workers in a lurch. RTD driver workforce shortages limited deployment of emergency bus shuttles.
This year, RTD ridership systemwide decreased by 3.9% when measured from January through July, compared with that period in 2024. The bus ridership this year has decreased by 2.4%.
On rail lines, the ridership on the relatively popular A Line that runs from Union Station downtown to Denver International Airport was down by 9.7%. The E Line light rail that runs from downtown to the southeastern edge of metro Denver was down by 24%. Rail ridership on the W Line decreased by 18% and on R Line by 15%, agency records show.
The annual RTD ridership has decreased by 38% since 2019, from 105.8 million to 65.2 million in 2024.
“The sickness on RTD light rail is spreading to other parts of the RTD system,” said James Flattum, a co-founder of the Greater Denver Transit grassroots rider advocacy group, who also serves on the state’s RTD Accountability Committee. “We’re seeing permanent demand destruction as a consequence of having an unreliable system. This comes from a loss of trust in RTD to get you where you need to go.”
RTD officials have countered critics by pointing out that the light rail’s on-time performance recovered this year to 91% or better. Bus on-time performance still lagged at 83% in July, agency records show.
The officials also pointed to decreased security reports made using an RTD smartphone app after deploying more police officers on buses and trains. The number of reported assaults has decreased — to four in September, compared with 16 in September 2024, records show.
Greater Denver Transit members acknowledged that safety has improved, but question the agency’s assertions based on app usage. “It may be true that the number of security calls went down,” Flattum said, “but maybe the people who otherwise would have made more safety calls are no longer riding RTD.”
RTD staffers developing the 2026 budget have focused on managing debt and maintaining operations spending at current levels. They’ve received forecasts that revenues from taxpayers will increase slightly. It’s unclear whether state and federal funds will be available.
Looking ahead, they’re also planning to take on $539 million of debt over the next five years to buy new diesel buses, instead of shifting to electric hybrid buses as planned for the future.
RTD directors and leaders of the Southwest Energy Efficiency Project, an environmental group, are opposing the rollback of RTD’s planned shift to the cleaner, quieter electric hybrid buses and taking on new debt for that purpose.
Colorado lawmakers will “push on a bunch of different fronts” to prioritize better service to boost ridership, Froelich said.
The legislature in recent years directed funds to help RTD provide free transit for riders under age 20. Buses and trains running at least every 15 minutes would improve both ridership and safety, she said, because more riders would discourage bad behavior and riders wouldn’t have to wait alone at night on often-empty platforms for up to an hour.
“We’re trying to do what we can to get people back onto the transit system,” Froelich said. “They do it in other places, and people here do ride the Bustang (intercity bus system). RTD just seems to lack the nimbleness required to meet the moment.”
Meanwhile, riders continue to abandon public transit when it doesn’t meet their needs.
For Denver Center for the Performing Arts theater technician Chris Grossman, 35, ditching RTD led to a better quality of life. He had to move from the Virginia Village neighborhood he loved.
Back in 2016, Grossman sold his ailing blue 2003 VW Golf when he moved there in the belief that “RTD light rail was more or less reliable.” He rode nearly every day between the Colorado Station and downtown.
But trains became erratic as maintenance of walls along tracks caused delays. “It just got so bad. I was burning so much money on rideshares that I probably could have bought a car.” Shortly before RTD announced the “slow zones” last summer, he moved to an apartment closer to downtown on Capitol Hill.
He walks or rides scooters to work, faster than taking the bus, he said.
Similarly, Honor Morgan, 25, who came to Denver from the rural Midwest, “grateful for any public transit,” said she had to move from her place east of downtown to be closer to her workplace due to RTD transit trouble.
Buses were late, and one blew by her as she waited. She had to adjust her attire when riding her Colfax Avenue route to Union Station to manage harassment. She faced regular dramas of riders with substance-use problems erupting.
Morgan moved to an apartment near Union Station in March, allowing her to walk to work.
She still hoped to rely on RTD for concerts and nightlife, and to reach DIA for work-related flights at least once a month. But RTD social media posts have alerted her to enough delays on the A Line that she no longer trusts it, she said. To reduce her “anxiety” and minimize the risk of missing her flights, she shells out for rides — even though these often get stuck in traffic.
She and her boyfriend recently tried RTD again, riding a train to the 38th and Blake Station near the Mission Ballroom. They attended “an amazing concert” there, she said, and felt happy as they walked to the station to catch the train home.
A man on the platform collapsed backward, hitting his head. He was bleeding. She called 911. Her boyfriend and other riders gathered. She ran across the street to an apartment building and grabbed paper towels. RTD isn’t really to blame, but “I just wish they had a station platform attendant, or someone. I do not know head-injury first aid,” Morgan said.
The train they’d been waiting for came and went. An ambulance arrived. They got home late, the evening ruined, she said.
“His head cracked open. He had skin flaps hanging off his head. This was stuck in my head, at least for the rest of the night.”
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Bruce Finley
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Companies running private Medicare and Medicaid insurance plans inaccurately list many mental health professionals as being available to treat the plans’ members, a new federal watchdog report says.
The investigators allege that some insurers effectively set up “ghost networks” of psychologists, psychiatrists, and other mental health professionals who purportedly have agreed to treat patients covered by the publicly financed Medicare and Medicaid plans. In fact, many of those professionals do not have contracts with the plans, do not work at the locations listed, or are retired, the investigators said.
The Office of Inspector General for the Department of Health and Human Services, which oversees the giant Medicare and Medicaid health programs, released its findings in a recent report.
The report focuses on insurers the government pays to cover people in Medicare Advantage plans and in privately managed Medicaid plans. About 30% of all Americans are covered by such insurance, the report says. The government pays the insurers hundreds of billions of dollars annually.
The companies are paid set rates per person they cover and are allowed to keep whatever money they don’t spend on patient care. The insurers are required to have adequate numbers of health care professionals under contract to serve patients in each region they cover.
But the new report found that 55% of mental health professionals listed as in-network by Medicare Advantage plans were not providing such care to any of the plans’ members. The figure was 28% for Medicaid managed care plans.
Some mental health professionals told investigators they shouldn’t have been listed as in-network care providers for the insurers’ members, because they no longer worked at the locations listed or because they didn’t participate in the Medicare Advantage or Medicaid managed care plans. Others said they were working as administrators and no longer providing patient care.
In one case, the report says, a private Medicaid plan listed a mental health professional as providing care in 19 practice locations. But when the investigators checked, a receptionist at one of the clinics said the person had retired a few years ago.
Jeanine Simpkins of Mesa, Arizona, learned how skimpy the networks can be when a 40-year-old family member was in crisis this fall. Simpkins struggled to find a drug rehabilitation program that would accept the Medicare Advantage insurance the relative is on because of a disability.
Simpkins said she contacted about 20 rehab programs, none of which would take the Medicare insurance plan. “You feel kind of dropped,” she said. “I was pretty surprised, because I thought we had something good in place for her.”
Simpkins’ relative eventually enrolled in part-time hospital care instead of an inpatient rehabilitation center.
It can be challenging for patients to find timely, nearby care, for all kinds of health problems, from colds to cancer.
But Jodi Nudelman, a regional inspector general who helped write the federal report, said in an interview that the stakes can be especially high for patients seeking mental health care.
“They can be particularly vulnerable,” she said. It can be daunting for people to acknowledge they need such care, and any roadblock can discourage them from trying to find help, she said.
She added that taxpayers aren’t getting their money’s worth if insurers fail to meet obligations to provide sufficient care options for Medicare and Medicaid participants in the plans.
The federal report focused on a sample of 10 counties in five states: Arizona, Iowa, Ohio, Oregon, and Tennessee. It included urban and rural areas. It did not identify the insurers whose networks were checked.
Susan Reilly, vice president of communications for the Better Medicare Alliance, a trade group representing Medicare Advantage plans, said managed care companies support federal efforts to improve access to mental health services. “While this report looks at a small sample of plans, we agree there’s more work to do and are committed to continuing that progress together with policymakers,” she said in a statement.
The report’s authors said their sample was a good representation of the national situation. It looked at 40 Medicare Advantage plans and 20 Medicaid managed care plans.
The report recommends government administrators make more use of medical billing data to confirm whether health professionals listed as in-network are providing care to patients covered by private Medicare and Medicaid insurance plans.
The watchdogs also recommend that federal regulators create a national, searchable directory of mental health providers, listing which Medicare and Medicaid insurance plans each one accepts. Such a directory would help patients find care and would make it easier to double-check the accuracy of plans’ listings of in-network providers, they said.
Federal administrators overseeing Medicare and Medicaid have taken steps toward creating such a directory, the authors said. Reilly, the industry representative, said managed care companies support the effort.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.
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A court record filed on Thursday by federal prosecutors says that Charlotte activist Cedric Dean “obtained millions of dollars in fraud proceeds” through a healthcare scheme.
Federal agents raided Dean’s properties in Charlotte on Thursday, The Charlotte Observer’s news partner WSOC-TV reported. News helicopters caught agents coming and going from those homes and searching vehicles outside.
“We did do a court-authorized investigative activity today,” local FBI spokesperson Shelley Lynch said on Thursday afternoon when asked about Dean. No one has been arrested, and the investigation is ongoing, Lynch added.
Eight witnesses described a scheme in which Dean and his recruiters “found people on the street,” got their Medicaid information, then submitted claims for services that they never received, according to the forfeiture complaint. That filing — which is civil and not criminal — allows prosecutors to seize assets and investigate them. It could also signal that criminal charges are on the way.
People used to file for Medicaid services were unhoused, it said.
The record includes other allegations:
Dean did not return a phone call on Thursday afternoon.
In total, as of July 7, he had submitted claims for more than $14.5 million in Medicaid funds and received more than $8 million, according to the filing. He used some of that money to buy vehicles, jewelry and properties, according to the complaint.
Dean’s work housing people has raised questions elsewhere.
A property for substance use treatment that he ran in Fayetteville got shut down by that city’s fire marshal because Dean did not have a required permit. In that case, too, city officials noted “questionable Medicaid billing practices.”
Earlier this year, Dean came to the defense of Charlotte City Council Member Tiawana Brown, who faces federal fraud charges in a different controversy. She is accused of lying to receive pandemic relief funds and using some of those funds for her own birthday party.
Ryan Oehrli covers criminal justice in the Charlotte region for The Charlotte Observer. His work is produced with financial support from the nonprofit The Just Trust. The Observer maintains full editorial control of its journalism.
This story was originally published October 16, 2025 at 4:31 PM.
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Ryan Oehrli
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Washington — Nationwide, states are racing to win their share of a new $50 billion rural health fund. But helping rural hospitals, as originally envisioned, is quickly becoming a quaint idea.
Rather, states should submit applications that “rebuild and reshape” how health care is delivered in rural communities, Centers for Medicare & Medicaid Services official Abe Sutton said late last month during a daylong meeting at D.C.’s Watergate Hotel. Simply changing the way government pays hospitals has been tried and has failed, Sutton told the audience of more than 40 governors’ office staffers and state health agency leaders — some from as far away as Hawaii.
“This isn’t a backfill of operating budgets,” said Sutton, CMS’ innovation director. “We’ve been really clear on that.”
Health Policy Futures Lab
Rural hospitals and clinics nationwide face a looming financial catastrophe, with President Trump’s massive tax-and-spending law expected to slash federal Medicaid spending on health care in rural areas by $137 billion over 10 years. Congressional Republicans added the one-time, five-year Rural Health Transformation Program as a last-minute sweetener to win the support of conservative holdouts who worried about the bill’s financial fallout for rural hospitals.
Yet, the words used by CMS Administrator Mehmet Oz and his agency’s leaders to describe the new pot of cash are generating tension between legacy hospital and clinic providers and new technology-focused companies stepping in to offer new ways to deliver health care.
It’s “what I would call incumbents versus insurgents in the rural space,” said Kody Kinsley, a senior policy adviser at the Institute for Policy Solutions at the Johns Hopkins School of Nursing.
Applications are due Nov. 5. The money will be awarded to states by the end of the year and distributed over five years.
Half of the $50 billion will be divided equally among all states with an approved application; the other half will go to states that win points. Of the second half, $12.5 billion will be allotted based on a formula that calculates each state’s rurality. The remaining $12.5 billion will go to states that score well on initiatives and policies that mirror the Trump administration’s “Make America Healthy Again” objectives.
The application identifies specific policy goals such as implementing the Presidential Fitness Test and restrictions to food assistance, as well as broader investment strategies around remote care services, data infrastructure, and consumer-facing technology tools, which CMS identified as “symptom checkers and AI chatbots.”
In September, after CMS officials released the application, Republican members of Congress from states with Democratic governors called for fairness, concerned their states might direct the money to urban areas. In a letter to Oz and Health and Human Services Secretary Robert F. Kennedy Jr., they said the money “will serve as a lifeline for rural and at-risk hospitals in our communities that are already struggling to keep their doors open.”
Smaller hospitals fear they will get “a tiny little slice” of each state’s share, said Emily Felder, who leads the health care practice at Brownstein Hyatt Farber Schreck, a law firm whose clients include rural hospital systems.
“There’s a lot of frustration,” Felder said.
But Kinsley, who was previously North Carolina’s secretary of health and human services, said using this money only to shore up a balance sheet “is really just throwing good money after bad.” In contrast, he said, insurgents such as technology-driven startups can offer new strategies.
One of those companies vying for funding is Homeward Health, a Silicon Valley-based company that contracts with Medicare managed care insurers. Using artificial intelligence analytics, Homeward helps patients get care in their home and with local providers.
The company manages the health of 100,000 rural Michigan patients enrolled in insurance, said Homeward co-founder and chief executive Jennifer Schneider. The company was a sponsor for the Watergate summit. It also has ongoing meetings with Oz and his team, Schneider said.
“They’re doing their job, and they’re talking to a lot of people in the ecosystem and really eager to learn from those of us that have been in the system,” Schneider said. “We’re one of many in that position.”
KFF Health News requested an interview with Alina Czekai, director of the newly created Office of Rural Health Transformation. CMS spokesperson Alexx Pons said the agency was “unable to accommodate facilitation of any interview.”
Instead, CMS provided an emailed statement from Oz saying the program “will help states and communities reimagine what’s possible for rural healthcare.”
Brock Slabach, chief operations officer of the National Rural Health Association, the largest organization representing rural hospitals and clinics, said the money would best be used to help pay for transformation that isn’t “sexy” or “revolutionary.”
“If what we end up with is we have a wearable for every rural patient, I don’t think that’s transformational,” Slabach said, referring to digital health monitors such as fitness-tracking watches.
Slabach, a onetime small-hospital chief executive and an unofficial adviser to hundreds of rural facilities nationwide, named a few ideas for the money — including paying for capital improvements such as electronic health records or equipment, loan repayment programs to aid workforce development, and creating “SWAT” teams that rescue rural hospitals on the brink of closure.
More than 150 rural hospitals have closed nationwide since 2010 — a statistic cited by CMS’ Sutton that is well known among industry watchers. The Sheps Center at the University of North Carolina, which compiles the closure data, also released a guide to help states calculate how rural they are for their applications.
State applications will be reviewed by a panel, with some reviewers from within the government but others outside it, said Kate Sapra, acting deputy director of the Office of Rural Health Transformation, speaking at the Watergate.
“We will train them in the scoring criteria,” Sapra said, adding that the panelists will not be coming from “your state” and will need to fill out conflict-of-interest forms. A portion of money each state gets will be reevaluated annually based on the progress it makes on its goals and priorities, according to CMS.
States are creating stakeholder groups, asking for public comment, and working with their health agencies. Some, such as Mississippi and New Mexico, are hiring consultants.
In Montana, a collection of health providers and associations proposed a list of ideas for the cash, including creating a loan repayment fund for rural clinicians to try to ease worker shortages.
“It’s one-time money, and it’s a little bit of money,” said David Mark, a doctor who is the CEO of One Health, which has clinics dotted across eastern Montana and Wyoming. A state could receive a minimum of $100 million a year for five years if all 50 states have applications approved.
“How do you accomplish goals of a health care system transformation with an infusion of money like that?” Mark said.
Neither Montana nor Wyoming — vast, rural states — sent leaders to the Watergate summit, according to a copy of the attendees list. In the afternoon, attendees could rotate among planning tables and meet with corporate sponsors such as the electronic health records behemoth Epic and the emergency services company Global Medical Response.
Wyoming Department of Health Deputy Director Franz Fuchs confirmed his state did not send representatives to the event, because they were “stretched with other commitments.” Montana, Wyoming, and other states submitted an optional letter of intent signaling they will apply for the funds. CMS did not respond to questions about how many and which states have submitted letters.
During the Watergate event, hints of brewing competition among states began to surface.
“I think Arkansas’ application is going to be better than yours,” seasoned political adviser Jack Sisson said with a smile during a morning panel.
The audience laughed. Sisson, who recently left his job as health adviser for Arkansas Gov. Sarah Sanders, had interrupted Michael Hendrix, policy adviser to another Republican governor, Tennessee’s Bill Lee.
“See, this is the kind of friendly competition that CMS is hoping for,” Hendrix said. He grinned, thanked Sisson, and added, “I look forward to us both winning.”
KFF Health News Montana correspondent Katheryn Houghton contributed to this report.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.
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At a September Senate hearing, Health and Human Services Secretary Robert F. Kennedy Jr. boasted about a rural health initiative within President Donald Trump’s “One Big Beautiful Bill Act.“
“It’s going to be the biggest infusion of federal dollars into rural health care in American history,” Kennedy said, responding to criticism from Sen. Bernie Sanders, I-Vt. Sanders said the law would harm patients and rural hospitals.
Kennedy was referring to the law’s five-year, $50 billion Rural Health Transformation Program, HHS spokesperson Emily Hilliard said. GOP lawmakers have made similar claims about the program.
The fund was added to the bill at the last minute to secure support from Republican lawmakers who represent rural states. Some were concerned about how the bill’s Medicaid cuts would harm rural America, where more than 150 hospitals have stopped offering inpatient services or been shuttered completely since 2010, according to the Cecil G. Sheps Center for Health Services Research at the University of North Carolina.
“The transformation fund was really talked about in the context of saving rural hospitals that would be facing these significant Medicaid cuts,” said Carrie Cochran-McClain, National Rural Health Association chief policy officer. Medicaid is the joint state-federal health insurance program that primarily covers low-income people and those with disabilities.
So is Kennedy right in his description of the rural health fund as a historic cash infusion, or does it fail to acknowledge critical context?
Trump’s tax and spending law is expected to reduce federal Medicaid spending in rural areas by at least $137 billion by 2034, according to an analysis by KFF, a health information nonprofit that includes KFF Health News. The Congressional Budget Office predicts the law will increase the overall number of uninsured patients by 10 million by 2034.
Rural health facilities disproportionately rely on Medicaid reimbursement to stay afloat. In 2023, 40.6% of children and 18.3% of adults under age 65 from rural areas and small towns were enrolled in Medicaid, according to the Center for Children and Families at Georgetown University. In metro areas, the rates were 38.2% and 16.3%, respectively.
The Trump administration argues that rural hospitals cannot rely on “legacy” funding sources like Medicaid and Medicare due to the programs’ reimbursement structure, which ties payments to the number of services provided, a model that’s not financially sustainable for rural facilities with typically low patient volumes.
“Distinct from these other programs, the Rural Health Transformation Program is designed to provide a flexible source of investment” to promote innovation, efficiency, and sustainability, the White House wrote in a memo.
Here’s how it works: States can propose projects spearheaded by state agencies, health care providers, consultants, and vendors aimed at various purposes, such as improving technology, access to care, and workforce recruitment.
States can use only 15% of their transformation program funding for provider payments and can direct money to non-rural areas, according to KFF.
Half of the $50 billion will be evenly divided among states whose applications are approved — regardless of their rural and overall populations — according to the “Notice of Funding Opportunity” for the program.
The other half will be awarded based on “the transformative possibilities” of states’ grant proposals; how much they’ve committed to aligning their health policies with the Trump administration’s; and data on their rural population, rural health facilities, uncompensated care, and other measurements.
The application deadline is Nov. 5.
Michael Meit, director of the Center for Rural Health and Research at East Tennessee State University, said the rural health community is excited about the innovations the new program might foster, but he’d “love for it to happen in the absence of these cuts that are going to devastate our rural health system.”
“It’s not going to fill the hole,” Meit said.
KFF estimates that the rural health fund’s five-year, $50 billion investment is a little over a third of the expected loss of federal funding in rural areas that will be spread over 10 years. According to that analysis, Medicaid cuts over that period would tally at least $137 billion in rural areas.
That number doesn’t account for other reductions stemming from the same law, such as cuts to the ACA Marketplaces or the health-system revenue loss expected from an increase in the number of people without insurance.
These factors are important to note because the rural health program is a temporary initiative while reductions in federal spending are long-term.
Another issue is the difference in the program’s spirit. The rural health fund is focused on transforming the rural health care system — not providing continued funding to keep facilities open or making up for lost Medicaid funds. Even if it triggers successful innovations, there are doubts that those will happen in time to prevent rural health facilities from closing.
“There’s a real misperception that somehow these funds are going to be able to save rural America or save rural hospitals,” Cochran-McClain said.
Joseph Antos, a health policy expert and senior fellow emeritus at the conservative-leaning American Enterprise Institute, said Kennedy’s comment is something “politicians say when they want to ignore the rest of the policies.”
“What they wanted was to say that they were creating a new program,” Antos said. “Well, this is a very inefficient way to distribute a relatively very small amount of money to hospitals that will incur much larger bad debt over the coming years, thanks to the cuts in Medicaid.”
Experts said that when viewed outside of mandatory programs like Medicare and Medicaid, the $50 billion rural health fund does appear to be unrivaled, especially for a limited, five-year program.
Several mentioned the Hill-Burton Act as another program that significantly boosted rural health care. The law provided loans and grants that modernized or built 6,800 health facilities, many of which were in rural areas, from 1946 to 1997, according to the Health Resources and Services Administration.
Incomplete funding data makes it difficult to account for inflation, said Kelsey Moran, an assistant professor and health economist at the University of Miami.
But she estimated that, during the life of the program, it spent $47 billion in 2024 dollars when using the Consumer Price Index, or $109 billion when using the CPI’s medical care index. The medical index has a higher inflation rate because health prices have risen more than overall prices.
Kennedy said the rural health fund is “going to be the biggest infusion of federal dollars into rural health care in American history.”
The statement contains an element of truth because the new program could be the most significant one-time investment in rural health funding.
But it ignores critical facts and context that create a different impression.
Federal contributions to rural areas from Medicaid and Medicare easily dwarf this program’s $50 billion mark. The new fund offers states flexibility in how they can allocate resources, meaning there’s no guarantee that all the new funding will go to rural Americans’ health care. The program comes at the same time rural areas are expected to lose far more from Medicaid cuts and an increase in uninsured patients than what the rural health fund infusion can backfill.
Experts say the rural health fund’s cash infusion is canceled out by other parts of Trump’s tax and spending law that call for cuts and policy changes.
We rate this statement Mostly False.
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Senators have launched an inquiry into companies paid billions in taxpayer dollars to build eligibility systems for Medicaid, expressing concern that error-riddled technology and looming work requirements “will cause Americans to lose Medicaid coverage to this bureaucratic maze.”
The letters, dated Oct. 10, were sent to four companies and follow a KFF Health News investigation that exposed widespread issues in states using Deloitte-run systems to assess Medicaid eligibility for millions of people. Failures have resulted in the erroneous loss of health coverage and other vital safety-net benefits for low-income people. Malfunctions in those systems can cost millions and take years to fix.
As most states prepare to institute work requirements mandated by the tax and domestic spending law President Trump signed in July, senators wrote it is each company’s responsibility to build functioning systems, “rather than to prioritize their bottom line.”
Democratic Sens. Ron Wyden of Oregon, Elizabeth Warren of Massachusetts, and Raphael Warnock of Georgia, as well as Sen. Bernie Sanders (I-Vt.), sent the letters to several companies the Centers for Medicare & Medicaid Services identified as eligibility system contractors: Deloitte, GDIT, Gainwell Technologies, and Conduent.
“They’re essentially health care middlemen that are in the business of red tape, and they profit when Americans don’t get health care,” Wyden, the top Democrat on the Senate Finance Committee, which oversees Medicaid, said in an interview.
“They’ve got a history of poor performance when it comes to determining eligibility or in helping Americans enroll in Medicaid,” Wyden said. “Without stronger oversight and real accountability, these contractors are just going to get a jumbo windfall for creating systems that actually harm Americans trying to get health care.”
Spokespeople for the four companies did not provide comments for this article.
As of June, 70.5 million people were enrolled in Medicaid, according to CMS.
A handful of states operate their own Medicaid eligibility and enrollment systems, but most rely on contractors to build and run them. KFF Health News found that Deloitte, a global consultancy that generated $70.5 billion in revenue in fiscal year 2025, dominates this slice of government business. Twenty-five states have awarded Deloitte contracts for eligibility systems. The agreements, in which the company commits to design, develop, implement, or operate state-owned systems, are worth at least $6 billion, dwarfing any of its competitors.
Kinda Serafi, a partner at Manatt Health, is advising states on how to reconfigure their systems to incorporate work requirements.
States are in a “major sprint” to make changes by 2027, she said, and they’re being “inundated” with pitches from vendors looking to secure contracts. It underscores the business opportunity these system changes represent for contractors.
“I think we have to really be vigilant to make sure that these vendors are implementing the requirements consistent with the law,” Serafi said.
Companies sign contracts with state governments, but the federal government pays the bulk of the cost. The federal government covers 90% of states’ costs to develop and implement state Medicaid eligibility systems and 75% of ongoing maintenance and operations expenses, according to federal regulations.
The Senate letters cite problems with Deloitte-run eligibility systems that KFF Health News identified. Among other issues, the Florida eligibility system erroneously cut benefits for new moms, and a problem in Kentucky prevented coverage applications from getting through online, which cost $522,455 and took 10 months to resolve.
“Unfortunately, these are just a few examples of third-party systems’ failure to serve their very function: to reliably and accurately determine an individual’s eligibility for Medicaid coverage and services,” the senators wrote.
The senators asked the companies to respond by Oct. 31 to their questions, such as whether companies’ contracts with states include financial incentives tying payment to the removal of Medicaid enrollees and whether the companies are penalized for coverage terminations made in error. The senators also demanded an accounting of the company’s lobbying expenditures for the past five years and protocols for making system changes.
By 2027, the Congressional Budget Office projected, based on an early version of the bill, 18.5 million Medicaid beneficiaries will have to work or complete other qualifying activities for 80 hours a month to keep their benefits, unless they qualify for an exemption. The CBO estimates that 5.3 million enrollees will lose coverage by 2034.
The new work requirements are just one of several federally mandated Medicaid changes that are forcing states to adapt their eligibility systems.
Medicaid work requirements have been plagued with problems in the few states where they’ve been tested. Medicaid enrollees have been frustrated in trying to navigate byzantine rules and glitchy technology. Work requirements have also come at great cost.
Georgia has not adopted the ACA Medicaid expansion, which has granted benefits to millions of adults earning up to 138% of the federal poverty level. Instead, the state offers benefits to some people earning up to the poverty line who can prove they’re working or participating in similar activities for 80 hours a month. Nearly 110,000 Georgians had applied to the state’s Georgia Pathways to Coverage program through May, but only 9,157 people were enrolled as of mid-August. Under typical ACA expansion rules, 336,000 adults would be eligible for coverage, according to KFF.
The Georgia program has cost $109 million, with $34 million spent on health benefits and more than $20 million allocated to marketing contracts, according to a KFF Health News analysis of state reports. Deloitte built Georgia’s eligibility system and is the primary consultant for the Pathways program.
Before Medicaid work requirements became federal law, Arizona also submitted a request to federal regulators to launch its own version that would apply to roughly 190,000 people.
The state’s application provided insight into the types of system changes states may soon need to make to manage the new federal work requirement.
Arizona Medicaid officials said they would gather information on enrollees’ work hours, training, and education. The state’s eligibility system, which is operated by Accenture, would also need to check whether someone is exempt.
States are in the early stages of determining changes they need to make to implement work requirements.
Tessa Outhyse, a spokesperson for the California Department of Health Care Services, said the state expects upgrades to be processed “through the existing contractual change order process.” State contracts with eligibility companies often set aside millions to cover the cost of changes, but systems may require upgrades beyond the agreed-upon work.
In Missouri, upgrades are expected to cost roughly $33 million, according to a state budget document.
The state has a contract with private company RedMane to handle some of its Medicaid eligibility processing. Missouri plans to hire an additional contractor to ensure it properly institutes Medicaid work requirements, according to Baylee Watts, a spokesperson for Missouri’s Department of Social Services.
Medicaid eligibility contractors “have a lot of leverage and expertise to influence contracts, to win contracts,” Wyden said. “They can do a lot more, to the value of what we’re giving them.”
KFF Health News senior correspondent Renuka Rayasam and correspondent Sam Whitehead contributed to this report.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.
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House Speaker Mike Johnson, R-La., escalated his blame of Democrats for the federal government’s ongoing shutdown.
“As a condition for ending the Democrat shutdown, Democrats want hospitals paid MORE to treat illegal aliens than American citizens — including young pregnant women,” Johnson said in an Oct. 5 X post.
He pointed to the Democrats’ proposal to reverse Republican spending bill health care provisions signed into law this summer.
“Republicans made it illegal for Medicaid to reimburse care for illegal aliens at higher rates than for U.S. citizens. Democrats are now demanding to reverse that,” Johnson said in the X post.
He made a similar statement in an interview on NBC’s “Meet the Press” the same day.
A spokesperson for Johnson pointed to Section 71117 in the Republican law that Democrats want to repeal. The provision limits the way states can use taxes levied on health care providers to finance Medicaid costs. States share Medicaid costs with the federal government.
But health care experts said the section doesn’t address hospital reimbursement for providing services to immigrants illegally in the U.S.
It “affects state financing mechanics, not coverage for undocumented patients,” University of California, Los Angeles health policy professor Arturo Bustamante said. “Reversing it wouldn’t suddenly increase payments for care to undocumented patients; it would just give states more flexibility in how they finance their Medicaid programs.”
Democrats also want to reverse another section of the GOP bill, 71110, that affects hospital reimbursements for emergency care provided to immigrants. This can include immigrants illegally in the U.S. but is not limited to them. It also includes other noncitizens with legal status, such as permanent residents who have a waiting period before they qualify for Medicaid.
The 1986 Emergency Medical Treatment & Labor Act requires hospitals to provide emergency services to stabilize patients regardless of their ability to pay or immigration status. States and the federal government reimburse hospitals for care provided to immigrants who meet all Medicaid requirements except for their immigration status; immigrants in the country illegally are not eligible to receive Medicaid. Those reimbursements are called Emergency Medicaid.
The Republican law didn’t end hospitals’ obligation to provide emergency care. Starting in 2026, it will reduce federal government reimbursements to hospitals for certain noncitizens’ emergency care, leaving states to cover a larger portion. The Democrats’ budget proposal restores reimbursements to previous levels.
Importantly, the Democratic proposal would not require that hospitals be paid extra to treat immigrants illegally in the U.S. It calls for states to receive the same amount of federal funding to cover Emergency Medicaid that they had received before the Republican law, health care experts said.
“I’m not aware of hospitals getting paid more for emergency care for undocumented immigrants,” Larry Levitt, executive vice president for health policy at KFF, a health think tank, said. By lowering how much the federal government covers, he added, Republicans are “just shifting costs to states.”
Law enforcements stand outside the hospital emergency after a shooting near the adjoining campuses of the U.S. Centers for Disease Control and Prevention of Emory University in Atlanta on, Aug. 8, 2025. (AP )
Most Emergency Medicaid spending is for childbirth. In all, spending on Emergency Medicaid represented less than 1% of total Medicaid spending in fiscal year 2023, according to KFF.
The Republican law’s changes to Emergency Medicaid reimbursements are focused on states that expanded Medicaid to cover a larger pool of people.
Forty states and Washington, D.C., expanded Medicaid under the Affordable Care Act, making adults ages 19 to 64, without dependent children and with incomes up to 138% of the federal poverty level, eligible. The federal government covers 90% of Medicaid costs for people included under the expansion, and states cover the rest.
For patients covered under regular Medicaid, and in states without the expansion, the federal government generally covers 50% to 77% of Medicaid costs.
The Republican law limits the amount the federal government reimburses hospitals for emergency care provided to patients who would be eligible for expanded Medicaid if not for their immigration status. Rather than cover 90% of costs, starting in 2026, the federal government will cover the rate it covers for non-Medicaid expansion care.
“Reducing the match rate for this care does not change the reimbursement for hospitals but instead shifts more of the costs to states,” said Jennifer Tolbert, deputy director of KFF’s Program on Medicaid and the Uninsured.
Johnson wrote on X, “As a condition for ending the Democrat shutdown, Democrats want hospitals paid MORE to treat illegal aliens than American citizens.”
Federal law requires that emergency care be provided to anyone who needs it, regardless of insurance or immigration status. The federal and state governments reimburse hospitals for emergency care provided to immigrants who meet all Medicaid requirements except for their immigration status.
Republicans’ new spending law calls for the federal government to cover a smaller portion of hospital reimbursements for emergency care to noncitizens who would be eligible for expanded Medicaid if not for their immigration status.
The GOP law doesn’t change hospital reimbursements. It shifts costs to states. Democrats want to reverse that.
Health care experts said a reversal wouldn’t mean hospitals would be reimbursed more for emergency care provided to immigrants illegally in the U.S. The federal government would cover the same share of care provided to anyone requiring emergency care, regardless of immigration or citizenship status.
We rate the statement False.
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Detroit Mayor Mike Duggan, who is running for Michigan governor as an independent after decades as a self-proclaimed Democrat, downplayed the impact of sweeping Medicaid cuts under former President Donald Trump’s “One Big Beautiful Bill.”
Speaking to business leaders at a Royal Oak Chamber of Commerce event last week, Duggan said the reductions “aren’t as bad as they look” and defended the law’s controversial work requirement for Medicaid recipients.
“You know what the Medicaid work requirement is?” Duggan said. “Either you’re looking for work, or you’re taking high school courses, you’re taking job training courses, or you’re volunteering in your community. If you’re doing any of those things, you keep your Medicaid. There’s no cut.”
Duggan went on to argue that the key is implementation.
“These Medicaid cuts are not as bad as they look, if state government knows what it’s doing,” he said.
If elected governor, Duggan said he would build a computer system to help residents log their work, education, or volunteer hours to remain eligible.
But health care leaders and Democrats say Duggan is ignoring the reality of Trump’s legislation, which slashes $840 billion from Medicaid over the next decade and adds new administrative barriers that experts say will cause millions of low-income Americans to lose coverage.
Brian Peters, CEO of the Michigan Health and Hospital Association, warned the cuts “will be disastrous for Michigan health care,” saying hospitals “will be faced with difficult choices that will include eliminating service lines or even entire facilities.” Peters said the bill will cost Michigan hospitals more than $6 billion in Medicaid funding over ten years.
Rural hospitals, many of which are struggling, stand to be hit hardest. In the Upper Peninsula, Ontonagon’s only hospital has closed, Aspirus Health in Ironwood has stopped delivering babies, and Sturgis Hospital recently ended inpatient care. A Republican hospital executive in Hillsdale even called Trump’s bill “devastating,” saying it “is going to hurt lives in this country — not just in Michigan, but in rural hospitals across the country.”
Polling from the Michigan Health and Hospital Association shows 86% of residents believe Medicaid is vital to their community, and 76% say it’s important to their families and friends. More than 700,000 Michiganders are projected to lose coverage as a result of the new law, which includes shorter eligibility periods, added reporting requirements, and expanded work rules that states must enforce.
Michigan Democratic Party Chair Curtis Hertel accused Duggan of siding with Trump’s donors over working families.
“Mike Duggan’s campaign is being bankrolled by MAGA donors and loyalists to Donald Trump, and now he’s dismissing concerns about Michiganders who are going to lose their care,” Hertel said. “More than 700,000 people across the state are set to lose their coverage, health care costs are going up, and hospitals are struggling to stay afloat — but for Duggan, these cuts ‘are not as bad as they look.’”
Duggan’s campaign pushed back, saying in a written statement that the mayor “has been one of Michigan’s strongest and most vocal supporters for expanding Medicaid coverage for the last 20 years.”
Campaign spokesperson Andrea Bitley said that Duggan was “strongly opposed to the cuts this year.” But when asked to point to Duggan’s public opposition to the GOP cuts, Bitley simply responded, “He’s addressed it multiple times.”
Metro Times couldn’t find an instance in which Duggan spoke out against the Medicaid cuts.
Bitley said Duggan, who previously served as CEO of the Detroit Medical Center in 2004, was trying to explain that he plans to build the proper infrastructure to prevent many Michigan residents from losing their Medicaid.
“The Mayor promised as Governor to implement a statewide computer program, making Michigan the easiest state in the country to document qualifying volunteer, education, or work activities so that our eligible residents will not lose their Medicaid coverage,” Bitley said. “The Mayor clearly explained that loss of Medicaid coverage in Michigan will not be as bad as predicted if you have the leadership of a governor who truly understands national healthcare knows how to implement an aggressive enrollment strategy.”
While Duggan’s proposal might reduce some bureaucratic hurdles, it can’t overturn the structural cuts in Trump’s bill. The majority of people who lose Medicaid under work-requirement programs do so because of confusing paperwork, short renewal periods, and strict federal rules, according to KFF, a nonpartisan health policy research organization based in California. Even with a modern computer system, Michigan would still be obligated to follow the federal law’s eligibility cuts and new verification mandates, which are expected to strip coverage from hundreds of thousands of residents.
The Congressional Budget Office estimates that nearly 12 million Americans could lose Medicaid coverage nationwide.
The Michigan League for Public Policy has warned that no amount of technology or reporting improvements can prevent people from losing coverage under Trump’s law.
Since Duggan announced his campaign for governor, he has tried to court independents and Republicans by attacking Democrats and adopting GOP talking points, including calling undocumented immigrants “illegal” in January while speaking to business leaders. When called out by pro-immigration groups, Duggan dismissed the criticism as “political correctness,” another term that conservatives have adopted.
Duggan’s political balancing act is turning off many Democrats. As Metro Times previously reported, Duggan’s campaign has raised millions from wealthy GOP funders, including major Trump donors Roger Penske, Ron Weiser, and J.C. Huizenga.
Meanwhile, Michigan is bracing for deep budget reductions from the federal cuts. A July report by the nonpartisan Citizens Research Council warned that the One Big Beautiful Bill will cost the state more than $1 billion in lost revenue and could force major reductions in health and social programs.
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Steve Neavling
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