New Report: House Budget Bill Could Reduce Medicaid Coverage, Cut Funding for Rural and Behavioral Health Care

On a percentage basis, Montana would lose more federal funding than any other state in the country

Bozeman, Mont. (June 6, 2025) – The Montana Healthcare Foundation released an analysis of how the Medicaid provisions in the House budget reconciliation bill could impact Montana. The analysis found that the House bill could result in an estimated 31,000 Montanans losing Medicaid coverage, along with a loss of $5.4 billion in funding for the state’s health system over 10 years. These changes would disproportionately impact rural Montanans.

The bill includes four changes to Medicaid:

• mandatory work requirements for adults between the ages of 18 and 64, with certain exemptions;
• more frequent determination of eligibility;
• banning new or increased provider taxes to help pay the state costs of Medicaid programs; and
• eliminating two eligibility and enrollment rules that simplified processes for eligible people – including children, seniors, and people with disabilities.

“These changes could result in thousands of Montana Medicaid enrollees losing health coverage. The impact would be especially harmful for rural communities, where access to care is already limited and Medicaid plays a vital role in the health care system.”

Dr. Aaron Wernham,
Montana Healthcare Foundation CEO

Key findings from “Medicaid Provisions in the House Budget Reconciliation Bill: Impacts on Montana Medicaid” produced by Manatt Health show:

• An estimated 31,000 Montana Medicaid enrollees would lose coverage, because of new work reporting requirements and changes in eligibility and enrollment processes. This includes 27,000 adults with low incomes and nearly 4,000 children, people with disabilities, and elderly Montanans. State data indicates that 76% of Medicaid-enrolled Montana adults are working or in school; an additional 17% are ill or have a disability, or are caring for home or family.
• $5.4 billion fewer dollars would be spent on health care for Medicaid enrollees over the next 10 years, impacting access to screenings, preventive services, behavioral health, and specialty services in rural Montana.
• 83% of decreased spending ($4.5 billion) will be due to lost federal dollars.

Montana Medicaid is the state’s health benefits program that provides insurance to eligible children and adults with low income. In 2015, the Montana State Legislature expanded Medicaid to cover adults ages 18-64 with incomes up to 133% of the federal poverty level through the bipartisan HELP Act. Of the 268,000 Montanans enrolled in Medicaid in 2024, about 95,000 (or 36%) were covered through the HELP Act.

To read the analysis, visit https://mthf.org/resource/manatt-report-the-one-big-beautiful-bill-act-impacts-on-montana-medicaid/

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Montana Healthcare Foundation is a 501(c)3 private foundation that makes strategic investments to improve health in Montana. It provides funding, leadership, and expertise to help communities tackle Montana’s most important health problems. It conducts policy analysis so that Montanans can be well-informed and engaged in decisions that impact their health. It prioritizes supporting the health and well-being of people and communities at increased risk for poor health outcomes because of income, geographic barriers, the availability and accessibility of health and social services, and health disparities. To learn more, visit mthf.org.