By Shalina Chatlani, Stateline.org
As Republicans in Congress consider cutting the federal share of Medicaid funding, states are weighing numerous options to scale back their programs. But voters in three states have significantly limited those options by enshrining Medicaid expansion in their constitutions — creating a potential budget disaster and a political challenge for the GOP.
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Over the past several years, voters in conservative Missouri, Oklahoma and South Dakota have amended their state constitutions to require their Medicaid programs to cover all adults below the age of 65 who earn equal to or less than 138% of the federal poverty level ($21,597 for an individual in 2025 ). Those states are among the 40 plus the District of Columbia that expanded Medicaid eligibility under the 2010 Affordable Care Act, with the federal government picking up 90% of the cost.
But much of that federal funding could soon vanish. Republicans in Congress are debating several options to achieve $880 billion in Medicaid cuts. One proposal would slash the 90% rate to the lower match rates states get for the traditional Medicaid population, mainly children and their caregivers, people with disabilities and pregnant women. Those percentages range from 50% for the wealthiest states to 77% for the poorest ones.
If Congress goes that route, states would have to come up with $626 billion over the next decade to keep the roughly 20 million people in the expansion population on the rolls.
Nine states (Arizona, Arkansas, Illinois, Indiana, Montana, New Hampshire, North Carolina, Utah and Virginia) already have laws on the books that would automatically roll back Medicaid expansion if the federal funds dip. Some states are considering requiring people to work, go to school or volunteer in order to receive Medicaid benefits, a condition that would trim the rolls and save money.
But because Missouri, Oklahoma and South Dakota have put Medicaid expansion in their constitutions, they can’t easily take those steps.
“Legislators cannot change that law without going back to voters for a whole other campaign to change the constitution,” said Kelly Hall, the executive director of the Fairness Project, a nonprofit that helped put the constitutional amendments on the ballot in all three states.
“Even if the federal government cuts their contribution towards funding Medicaid expansion, those three states do not have the option to reduce eligibility or benefits for the Medicaid expansion population,” she told Stateline. “They will have to find those resources.”
Medicaid is a huge component of state budgets. Including the federal matching money, states spend an average of nearly a third of their budgets on Medicaid. And the program is also the single largest source of federal funds for states.
Missourians voted in favor of a constitutional amendment to expand Medicaid in August 2020. When state lawmakers refused to fund the expansion, residents sued the state’s Department of Social Services. In 2021, the state Supreme Court ruled that the legislature had to find the resources for Medicaid expansion — a huge win for progressives.
For 2025, Missouri allotted $18.2 billion for Medicaid, with the federal government covering $12.7 billion of that, or about 70%. If Congress cuts the federal share of Medicaid funding by $880 billion over the next decade, it would leave Missouri with a budget hole of around $1.7 billion next year, according to research from nonprofit group the Commonwealth Fund. That would force the state to come up with some options to avoid fiscal disaster.
Timothy McBride, a health policy analyst and co-director of a program at the Institute for Public Health at Washington University in St. Louis, told Stateline that these include raising taxes, cutting enrollment for other Medicaid populations, diminishing reimbursements to providers, getting rid of optional medical services such as dental care or ceasing payments for equipment like wheelchairs.
Raising taxes is not a likely or popular choice in Republican-leaning Missouri, McBride noted, while adding that cuts to providers would further endanger struggling hospitals.
“We lost 10 hospitals in Missouri in the last few years. And if you start cutting their payment rates, that’s going to just put them at risk,” McBride said. “The real money is in the disabled and the elderly populations. And so if you really wanted to quote-unquote save money, that’s probably where you’d have to look. But that’s really controversial.”
The state budgetary implications of a potentially sharp decline in federal Medicaid funding have influenced some prominent opponents of Medicaid expansion to have a change of heart. U.S. Republican Sen. Josh Hawley supported efforts to repeal the Affordable Care Act in 2018 when he was Missouri’s attorney general. Now, Hawley has said he would refuse to vote for any Medicaid cuts.
“I’m not going to vote for Medicaid cuts, benefit cuts. Work requirements are fine. But 21% of the residents in my state receive Medicaid or [the Children’s Health Insurance Program]. That’s a lot of people,” he told reporters on Capitol Hill in February.
Republicans in the closely divided U.S. Congress might have trouble pushing through Medicaid cuts if other conservative lawmakers from Missouri, Oklahoma and South Dakota follow Hawley’s lead.
Oklahoma voters expanded Medicaid via a constitutional amendment in 2020. South Dakota followed suit in 2022. Republicans in all three states want to impose work requirements on able-bodied Medicaid recipients, but doing so would not save enough money to make up for the loss of federal dollars.
South Dakota Republican state Rep. Will Mortenson said he respects that voters chose to expand Medicaid, and added that the state has “faithfully” implemented it. But the decision to amend the state constitution “can only be described as a foolish decision,” he said in an interview.
“A constitution is not meant to be a flexible document that you change annually or even every other year,” Mortenson said. “And so now, as we’re staring down the barrel of the federal government contemplating changes to Medicaid, including for the expansion population, our state is hamstrung in that we cannot effectively respond to those changes.”
Mortenson is one of the lead sponsors of a bill that would ask voters to consider a ballot measure in the next general election to amend the constitution again, this time conditioning Medicaid expansion on the level of federal assistance. The measure has passed both chambers of the legislature.
But some of the supporters of the original constitutional amendment say they would fight any attempt to change it. Any restrictions, including work requirements, would severely harm working-class people, said Doug Sombke, head of the South Dakota Farmers Union. Sombke told Stateline that most farmers in the state struggle to make ends meet and certainly cannot offer high wages or health care benefits to their workers.
“There’s just no extra income,” Sombke said. “And, in South Dakota, we’re a right-to-work state, so you can get fired for any reason. As a worker, you really don’t have a lot of choice.”
Hall, of the Fairness Project, said amending the constitution is the most effective way to expand Medicaid in states where conservative-leaning lawmakers have been reluctant to do so. She said she suspects that voters in other states might pursue the constitutional amendment strategy if their state lawmakers try to roll back expansion.
“I do think that it’s possible that if we see these cuts move forward in D.C., and states are making highly unpopular choices to cut benefits for people, that we will see this issue back at the ballot box,” Hall said. “But for right now, I would say we’re seeing the power of constitutional amendments to protect benefits in action in real time.”
Stateline reporter Shalina Chatlani can be reached at schatlani@stateline.org.
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