Montana Grapples with Medicaid Expansion Amid Federal Uncertainty
Montana’s Medicaid expansion faces an uncertain future as lawmakers navigate potential federal policy shifts that could significantly impact state budgets. Experts warn that proposed changes could transfer substantial costs to states, forcing them to either raise revenue or cut spending to maintain current coverage levels.
Robin Rudowitz, vice president and director of the Program on Medicaid and the Uninsured at KFF, emphasized the challenge states face in managing these financial uncertainties. “There are no easy answers or options for states in these scenarios,” she noted.
Several states are already taking precautionary measures. South Dakota lawmakers are considering a bill that would let voters decide whether to continue Medicaid expansion if federal contributions decline. Meanwhile, Idaho legislators have introduced bills either repealing the expansion outright or making it conditional on federal approval of new limitations. Montana is among nine states with trigger laws that could end Medicaid expansion if federal funding drops.
Despite these concerns, Montana’s GOP-led House of Representatives overwhelmingly passed a bill on Feb. 10 to make Medicaid expansion permanent. House Bill 245 later cleared its first Senate vote on Feb. 20, but Gov. Greg Gianforte has yet to signal whether he will sign it. He has previously expressed support for the program, provided strong work requirements are in place.
During budget discussions, lawmakers debated how Montana could absorb potential federal funding cuts. The federal government currently covers 90% of healthcare costs for Medicaid expansion enrollees—low-income adults under 65 without disabilities. A 10% reduction in federal support could add $100 million in state costs, while a shift to the standard 38% state match would require Montana to contribute an additional $280 million annually.
Republican Sen. Jeremy Trebas, a proponent of tightening work requirements, warned that Montana should align its policies with anticipated federal changes. “We should match up our state policy to coming federal policy so that we’re not caught off guard,” he said. His proposal, Senate Bill 199, which sought to enforce stricter work requirements, was defeated in the Senate after opposition from Democrats and a small group of Republicans.
Senate President Matt Regier has since introduced a bill aimed at limiting Medicaid expansion to individuals below 100% of the federal poverty level while giving state agencies more authority to regulate spending. The bill also calls for a special legislative session if federal contributions drop significantly before the next scheduled session in 2027.
However, Rep. Ed Buttrey, the sponsor of HB 245, argued that Montana’s existing laws already account for potential federal cutbacks by either increasing enrollee premiums or requiring additional legislative funding. He also downplayed the likelihood of swift federal policy changes but acknowledged that if they did occur, a special session would likely be necessary.
With Medicaid expansion affecting a significant portion of Montana’s population, lawmakers remain divided on the best course of action as they brace for potential shifts in federal healthcare policy.
