A perfect storm is about to crash into many states
Source: Raw Story · Bias: Far Left
Summary
A perfect storm has arrived on the ledgers of many state budgets, bearing down on the people who often need help the most.Federal and state policy decisions, the end of pandemic aid and long-term fiscal trends — such as people aging into Social Security benefits — are requiring states to take a tougher look at their financial plans than they have in the past.President Donald Trump’s One Big Beautiful Bill Act is weighing heavily on legislators, who face having to make up for billions of dollars the bill cuts out for states to help fund programs, such as Medicaid and the Supplemental Nutrition Assistance Program, that allow low-income people to receive health care and pay for groceries.At the same time, states are grappling with the end of federal funds they had been receiving since 2021 as part of the Coronavirus Aid, Relief and Economic Security Act and the American Rescue Plan Act.The combination leaves lawmakers in many states grappling with ways to lessen the impact on Americans.Potential Medicaid cuts Kansas is projected to lose more than $3.9 billion in Medicaid funding over the next 10 years, according to a report by the United Methodist Health Ministry Fund and Reach Healthcare Foundation, both based in the state.David Jordan, president and CEO of the United Methodist Health Ministry Fund, said he does not expect the state to backfill the federal cuts to Medicaid and SNAP.“It’s really going to trickle down to Kansas in a way that just makes (residents’) lives harder economically. It’s going to make it tougher to get those supports like Medicaid or help putting food on their table, which is really too bad,” Jordan said.The federal cuts to the program could leave more Kansans uninsured. That means hospitals would then receive less in reimbursements, which could lead to higher medical costs and potential closures, according to the United Methodist Health Ministry Fund and Reach Healthcare Foundation.Kansas Gov. Laura Kelly’s fiscal year 2027 budget lays out plans to designate $15 million to handle the increased caseload in the Children’s Health Insurance Program to help maintain health coverage for children.In Arizona, legislators had three budgetary options going into the session: go above and beyond to conform with the bill, do the bare minimum or not conform at all.“In the six years that I’ve been here, this is the first time that we have not gone into session saying, ‘Yeah, we’re going to rubber-stamp conform to the federal and keep right on marching,’” said Rep. Stephanie Stahl Hamilton, D-Tucson.She said the biggest impact of Trump’s bill will be felt in health care and that social services, Medicaid, food and other benefits would be hit hard. The state does not have enough “rainy day” funds to backfill the programs that will be impacted by the bill.Tax increases might seem to make up the difference, but they are very difficult to pass as they require a two-thirds vote, according to Dennis Hoffman, professor of economics at Arizona State University.“We’re going to cut income taxes again this session to conform with the Big Beautiful Bill,” Hoffman said. “So, it just means that there’s less limited resources to go around to support other things.”Systemic changes to Medicaid will require almost 200,000 Arizonans to submit paperwork to Arizona’s state Medicaid service, to keep their coverage. That’s because a major aspect of Trump’s bill is that enrollment in Medicaid will require workforce participation or participation in another qualifying activity, like education or a work program. States must implement that condition by Jan. 1, according to the Center for Health Care Strategies.The Grand Canyon Institute, a bipartisan economic think tank, analyzed the state’s three main options.Significant conformity with the new regulations would create a deficit of more than $300 million and cut funding to other agencies, according to the institute. Minimal conformity would leave a small surplus but would not fund all other priorities, and non-conformity would fund other state agency priorities but risk penalties for being out of compliance with the new regulations.SNAPAs Tennessee expects to face a tighter budget in the next fiscal year, lawmakers are moving to seek federal funding through the federal Summer Electronic Benefit Transfer program after Republican Gov. Bill Lee declined to opt in for the second consecutive year.Lee’s decision has left hundreds of thousands of Tennessee children not receiving school meals during the summer. The legislation would require Tennessee to participate as long as the federal program remains available.The program provides grocery benefits to families who receive free school meals.
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