Medicaid covers nearly 1 in 4 Virginians. Here's what could happen if federal funding goes away.

Yahoo

11-02-2025

RICHMOND — President Donald Trump has promised to 'love and cherish' Medicaid, but Congressional talks of cutting billions in funding to the program have advocates worried. Virginia Medicaid, called Cardinal Care, and Children's Health Insurance Program (CHIP) together cover nearly one in four Virginians.
The Virginia Senate budget proposal includes an amendment that would require the legislature to act before hundreds of thousands of Virginians are automatically disenrolled if funding levels drop. But much remains uncertain about the future of the program in the state.
Here's how Medicaid works in the commonwealth and what experts say could happen if funding is cut or eligibility requirements are changed.
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Medicaid is a program run jointly by the federal and state governments that in Virginia pays for medical costs for people who meet low income thresholds, people with disabilities and people over age 65. It's different from Medicare, which is a federal health insurance program primarily for people over 65. CHIP, called Family Access to Medical Insurance Security, or FAMIS in Virginia, is low-cost health insurance for children in families that make too much money to qualify for Medicaid but not enough to afford other insurance.
Medicaid covers things like dental health, behavioral health services and prescription drugs, as well as births and long term care for seniors. In Virginia, one in three births are covered by Medicaid. Medicare covers rehabilitative care for seniors, like if you break your arm, but it does not cover things like nursing home care.
In 2018, Virginia voted to expand Medicaid under the Affordable Care Act to people who make up to 138% of the federal poverty level. In 2025, that amounts to an annual income of $21,597 for a single person and $44,367 for a household of four. Medicaid expansion was a big deal because for the first time, low-income adults with no children qualified for medical insurance.
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'If you're an able-bodied adult with no children, before Medicaid expansion, no matter how low income you were, you weren't eligible (for Medicaid),' said Freddy Mejia, policy director at The Commonwealth Institute (TCI), a progressive advocacy group.
Forty states, plus Washington, D.C., have voted to expand Medicaid.
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About 2 million children and adults statewide are insured through Medicaid or FAMIS. That includes 630,000 Virginians who are insured through Medicaid as a result of expansion. Roughly 14% of adults ages 19 to 64 are covered by Medicaid, as are 30% of children. Those numbers increase in rural areas, where 19% of adults and 38% of kids are covered by Medicaid.
'Particularly in rural areas, the health centers and health clinics rely on Medicaid funding to keep the doors open,' Mejia said.
In the Tidewater region, more than 440,000 people are insured through Medicaid, including 147,000 adults who are covered because of expansion.
In Virginia, total Medicaid spending was about $21.6 billion in fiscal year 2024. For regular Medicaid, the federal government must pay at least 50% of state Medicaid costs, and the exact rate is determined by state median income. Because Virginia is a wealthier state, the federal government kicks in less than it does for other states, and Virginia's share of the cost is close to 50%. The Medicaid expansion match rate is much more generous — the federal government pays 90% of the costs, and the other 10% is paid for by a tax on private hospitals.
'In reality, the state doesn't pay anything for Medicaid expansion,' Mejia said.
But higher enrollment rates and increases in the cost in care and services have created a shortfall of more than $630 million in Virginia's Medicaid funding.
Gov. Glenn Youngkin said he plans to cover the Medicaid shortfall through his budget amendment request of over $687 million.
'There is no set path yet on what's going to happen with regards to Medicaid,' Youngkin told reporters after his State of the Commonwealth address last month. 'Our job in the state right now is first of all, to fully fund our Medicaid responsibilities, and that's exactly what I've done with our budget amendment. We do have a rapid increase in Medicaid costs in Virginia, and I've spoken to legislators on both sides about working together to find ways we can address (the costs).'
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Congress and the Trump administration are weighing a menu of options to fund Trump's domestic agenda that could amount to $2.3 trillion in Medicaid cuts over the next decade. Advocates are particularly concerned about the potential for a reduction in Medicaid expansion. Virginia is one of nine states with a 'trigger law' that says if the federal contribution to Medicaid expansion drops below 90%, the program automatically ceases and everyone who uses Medicaid expansion will be disenrolled.
Advocates also worry about services that are optional for states to include under Medicaid that could be on the chopping block if Virginia suddenly needs to fund a greater share of Medicaid. That includes things like dental care, and community-supported living arrangements.
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TCI estimates that every percentage point the federal share of Medicaid expansion funding drops would cost the state about $70 million. If the federal government share dropped to closer to a 50% rate like for other Medicaid funding, that would amount to about $2.7 billion.
'We would hope that there would be an opportunity to fund it somehow, but that's a lot of money for any state,' Mejia said.
A budget amendment included in the state Senate budget proposals would require the Health and Human Resources joint subcommittee to meet and assess the financial impact on the commonwealth should the federal match rate drop, before disenrolling people insured through Medicaid expansion. Mejia said it's a good first step.
'Our big concern is that if the federal government takes action, we don't want that timeline to start with people losing coverage,' he said. 'We want the ability for Virginia lawmakers to make a decision and to weigh in before mass coverage loss and people are impacted, people can't fill their prescriptions from one day to another.'
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If you have insurance through Medicaid, experts say not to panic.
'We are telling everybody to continue to enroll,' said Emily Henry, elder law attorney at the Virginia Poverty Law Center. 'Nobody should be opting out of Medicaid on the chance that there is a federal change, because they should still get coverage while they can. Should that change, that will be something they'll get notice of and information on, and they can make a decision at that point.'
Kate Seltzer, [e-mail], [phone].