May 2, 2025
As the U.S. Congress develops the federal budget, several proposals have surfaced to meet the stated goal of $880 billion in savings from the House Energy and Commerce Committee. Many of these proposals center on Medicaid, which provides health coverage to low-income individuals and families, older adults, and people with disabilities, nationwide. While these savings targets and resulting initiatives are not final and will likely evolve, it's important to understand how some of the proposed federal changes may impact MaineCare -- Maine's Medicaid program -- and the people it serves.
As of January 2025, roughly 392,000 Mainers were enrolled in Medicaid and the Children's Health Insurance Program under MaineCare.
Federal Partnership: A Critical Component of MaineCare
MaineCare, like all Medicaid programs, is built on a state-federal partnership, with federal funding playing a central role in ensuring access to health care for Mainers of all ages. Currently, federal law ensures the federal government covers:
- 90% of the cost for low-income, childless adults enrolled through MaineCare Expansion
- Approximately 74% of the cost for moderate- to low-income children enrolled under the Children's Health Insurance Program (CHIP)
- Approximately 62% of the cost for most other MaineCare members
Where MaineCare Makes a Difference
MaineCare supports a broad range of health care services across the state. The top funded services include:
- Hospital care
- Community-based supports for people with developmental disabilities
- Prescription medications
- Long-term care and nursing facilities
- Mental health and substance use disorder treatment
- Physician and Community Health Center services
In addition to its vital role in supporting public health, MaineCare also contributes significantly to family stability and the overall well-being of Maine's communities.
Continuing to ensure affordable, preventive care through this program supports:
- Health Access: Helping Mainers get the care they need, when they need it
- Prevention: Reducing costly health interventions by identifying issues early
- Financial Security: Lessening the burden of medical expenses for households
- Health Outcomes: Supporting healthier individuals and communities statewide
- Community Engagement: Healthcare services that support individuals, including those with disabilities, in actively contributing to Maine's communities and economy
Potential Federal Changes Under Consideration
A number of potential policy changes are being discussed at the federal level, including:
- Placing a growth cap on federal Medicaid funding per Medicaid expansion enrollees
- Elimination of the enhanced federal match for expansion populations
- Limiting provider taxes, which are an important financing mechanism in almost all states
- Requiring certain Medicaid beneficiaries to meet work requirements
Maine has modeled the estimated impact of these potential proposals based on the limited proposal details available. For more detail on the potential impacts, please refer to The Impact of Proposed Federal Medicaid Changes on MaineCare (PDF).
What This Could Mean for Maine
The proposed changes to federal Medicaid funding would shift significant costs to states. Unlike the federal government, Maine is required to balance its budget each year, meaning increased health care costs at the state level will have significant implications, including potential reductions to services, eligibility, and reimbursement under MaineCare.
In addition, we know that Medicaid expansion led to a $126 million reduction in uncompensated care costs across Maine hospitals over the course of 2020 and 2021. Proposed federal changes to Medicaid could have ripple effects across the broader healthcare system. For example, cuts to Medicaid funding would likely result in increased uncompensated care for hospitals already facing financial strain, impacting the systems that so many Mainers rely on.
If these changes or some combination of them are implemented, they will have devastating consequences for lifesaving health care and access for Maine people. If enacted, these proposed cuts will:
- Reduce access to health care for individuals including children and seniors across Maine
- Increase Mainers' rates of medical debt and financial strain
- Lead to delayed or foregone care, with potential long-term health consequences including premature death
- Reduce MaineCare reimbursement and increase uncompensated care costs for providers
- Strain Maine's health care infrastructure, especially in rural areas where clinics, nursing facilities, and hospitals rely heavily on MaineCare funding to remain operational
- Affect Maine's broader economy, as reduced Medicaid funding could impact jobs in the health care sector and increase financial pressure on local systems and communities
The Department will continue to follow federal policy developments closely and remains committed to keeping stakeholders informed about any potential changes and the impact on MaineCare.