Medicaid, a federal health insurance program for low-income children and adults, faces dual challenges at both the state and federal levels.
Nationally, Congressional Republicans are pushing to cut approximately $880 billion in healthcare and energy spending over a decade. The Nonpartisan Policy Institute on Budget and Policy Priorities says this is not possible without reducing Medicaid.
It is not yet clear how these cuts can take, but the proposals include changing payment changes to fixed or per capita amounts, reducing Medicaid's growing population matching rates and adding work requirements.
The Trump administration has pledged that cuts will not reduce benefits, saying taxpayers will lose as much as $521 billion a year to fraud. He claimed that most of them came from qualification programs such as Medicare and Medicaid.
Meanwhile, Maine lawmakers failed to pass supplementary budgets last week with a two-thirds majority needed to immediately address the $118 million shortfall in the state's Medicaid program.
Most House Republicans didn't vote for the measure and said they wanted to see more reforms to the program. In response, the state said it would need to suspend temporary payments to certain healthcare providers.
On Thursday, the majority Democrats advanced their budgets than Republican opponents saving the Medicaid program, but only the following year. The budget does not include the expected $100 million increase in main care costs for 2027, the Portland Press Herald reported. The Maine governor signed the budget late Friday afternoon.
Maine Equality Justice Policy Advocate Alex Carter told the Maine Monitor that the state's Medicaid deficit is “at the tip of the iceberg and we can see if such a massive cut has been made to federal Medicaid spending.”
So, what does Medicaid actually cover in Maine?
Medicaid is main care
First and foremost, it is important to note that the Maine Medicaid version is called MaineCare. The program is jointly funded by the state and federal governments.
There are several services, including hospital visits, nursing facility stays, and home health services, which need to be covered under Medicaid, and then there are additional services that allow the state to opt. For example, Maine has chosen to provide coverage to seniors in residential care who are lowering their incomes to reach Medicaid thresholds.
According to DHHS, 32% of the state's total budget was spent on main care in 2023.
As of December, MaineCare had nearly 400,000 members enrolled in a variety of programs, including Medicaid, Children's Health Insurance Program (CHIP), and additional state-specific categories.
Almost a quarter of those registered with MaineCare are part of the expansion of eligibility approved by Mainers, which was approved in a referendum in 2017, and Governor Janet Mills hired him when he took office in 2019.
One way Congress could potentially cut Medicaid is to reduce financial support to the state for this expanded group. Currently, Maine's expanded population (federal funding rate for approximately 94,000 Maines) is 90%.
The Robert Wood Johnson Foundation has discovered that if Congress reduces the matching rates for those registered to Medicaid expansion, Maine will lose $117 million in federal money and force state leaders to remove 25,000 people from Medicaid.
Last year, about two-thirds of residents of Maine nursing homes and about half of Maine children were covered in Main Care.
Impact on the health system
Stephen Michaud, president of the Main Hospital Association, said Main Care accounts for around 18% of the statewide hospital business, but that's broadly circumstance.
18% doesn't sound like a lot, Miko said, “But it's in our world.”
Lisa Harvey McPherson, vice president of government relations at Northern Light Health, said revenue from main care payments differs between each hospital in the system, ranging from 12-64%.
“Some provider types in Maine rely on main care, including nursing homes and community behavioral health services,” she said. “We rely on community services to provide care to patients throughout Maine.”
Almost half of hospital births across the state were covered by MaineCare, depending on the average for the three-year period from 2021 to 2023 by the Main Hospital Association. Michaud said that rural hospitals have increased to 55%.
MaineHealth said 13% of total revenue comes from MaineCare payments, and 43% of behavioral health patients are participating in MaineCare.
Government chief executive Katie Fullam Harris added that MaineHealth is “very concerned” about its eligibility to providers or reduced payments.
“Maine's healthcare infrastructure is currently shaking at the edge of a real challenge,” she said. “There's no room to absorb the additional costs.”
The story was originally published by MainMonitor, a nonprofit and nonpartisan news organization. To get regular coverage from your monitors, sign up for our free monitor newsletter here.
