On February 26, 2025, the U.S. House of Representatives narrowly passed a budget resolution proposing $880 billion in spending cuts from the agency that oversees the safety-net insurance funding, including Medicaid. This decision has sparked significant concern among healthcare advocates and policymakers, threatening to undermine a program that provides essential health services to over 70 million Americans.
In response to the proposed cuts, several states are initiating legal actions to protect their Medicaid programs. For instance, Michigan Attorney General Dana Nessel announced her intention to file a lawsuit against the federal government’s recent funding freeze, which affected Medicaid and Head Start. Nessel emphasized the immediate and significant impacts on the state, highlighting the urgency of seeking legal remedies to restore funding that would ultimately improve health outcomes and prevent death.
Similarly, Illinois Governor JB Pritzker has accused the Trump administration of withholding nearly $1.9 billion in federal funds from state agencies, non-profits, and small businesses. This withholding came after a federal judge blocked an order to freeze these funds. Illinois is one of nine states that have “trigger laws” that require states to terminate Medicaid expansion if the federal government’s financial support dwindles. Pritzker warned that up to 770,000 Illinois residents could lose Medicaid coverage due to the proposed budget cuts, and Illinois is pursuing additional litigation to protect Medicaid under the Affordable Care Act.
Beyond individual state actions, a coalition of organizations, including the National Council of Nonprofits and the American Public Health Association, has filed a lawsuit to block the federal funding freeze. They argue that the freeze lacks legal basis and rationale and will have devastating consequences on their operations and the communities they serve. The freeze fails to consider the reliance interest of many grant recipients, including those to whom money had already been promised. The organizations were recently granted a preliminary injunction to halt the freeze and restore Medicaid funding.
Moreover, civil rights groups argue that the funding freeze and subsequent Medicaid cuts could disproportionately harm communities of color, potentially violating the Equal Protection Clause of the Fourteenth Amendment. If the lawsuits proceed, courts may be asked to weigh the disparate impact of the budget cuts on marginalized populations.
Healthcare advocates urge the public to voice their concerns to their representatives. The National Health Law Program emphasizes that cutting $880 billion from Medicaid would have devastating consequences, forcing states to slash services or remove individuals from coverage.
As the budget proposal moves to the Senate, its fate remains uncertain. However, the growing wave of legal challenges highlights the crucial role of the judiciary in safeguarding access to essential healthcare services for millions of Americans.