How Medicaid and SNAP cuts could affect your state
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States could lose thousands of jobs and billions of dollars in economic output under potential Medicaid and food aid cuts, a new estimate finds.
Why it matters: Millions of Americans rely on federal financial assistance — money that gets spent at doctors' offices, grocery stores and so on, supporting jobs and economic activity.
Driving the news: The House of Representatives' latest budget resolution calls for more than $1 trillion in combined cuts to programs overseen by the House commerce and agriculture committees, which include Medicaid and the Supplemental Nutrition Assistance Program (SNAP).
- The details of any such cuts would need to be sorted out in Congress; the Senate has not yet worked out its own budget blueprint.
What they did: In the meanwhile, a new analysis from the Commonwealth Fund and the George Washington University Milken Institute School of Public Health seeks to estimate the economic consequences of major Medicaid and SNAP cuts.
- The researchers' estimates assume $880 billion and $230 billion in broad Medicaid and SNAP cuts over 10 years, respectively, spread out evenly over the decade and proportionately among states.
What they found: In 2026 alone, such cuts could cost more than 1 million jobs nationally, cause a $113 billion drop in combined state GDPs and result in nearly $9 billion in lost state and local tax revenue, the researchers estimate.
- The hit to state GDPs would exceed the estimated $95 billion in federal savings achieved through such cuts, the report finds.
Zoom in: In terms of job losses, New Mexico (about 634 per 100,000 people), Kentucky (579) and Washington, D.C. (560) could be the hardest-hit states or areas.
Caveat: Any actual cuts to Medicaid and SNAP could wind up being smaller.
What they're saying: "Some have argued that Medicaid or SNAP budgets can be cut harmlessly by eliminating 'waste or fraud,'" the researchers write.
- "But as we've shown ... drastic reductions in federal funding will necessarily have major financial repercussions, because they shrink the flow of dollars into states' economies."
What's next: Although Republicans, who control the White House and both houses of Congress, are eager to reduce federal spending, cutting widely-used entitlement programs like Medicaid has long been considered political suicide.
- The latest polling shows broad support for leaving Medicaid untouched or increasing spending, even among Republican voters — numbers that may give some lawmakers pause before approving big cuts.
