Red States Are Prepping More Medicaid Cuts if Republicans Keep Congress

On Tuesday, South Dakotans will decide whether to approve a Republican state legislature–led ballot measure that would automatically repeal Medicaid expansion in the event that Congress lowers federal matching payments, which currently sit at 90 percent.

The Republican push comes four years after South Dakotans approved another citizen-led ballot measure to pass Medicaid expansion.

The move would make South Dakota the latest state to implement Medicaid-gutting “trigger laws” that would eliminate expansion programs if federal funding drops below that threshold. Ten states have already passed such laws, almost all of which would be triggered by any further drop in Medicaid matching funds—most recently Utah, which passed its Medicaid trigger law this past March. Republican-dominated legislatures in other conservative states, including Oklahoma and West Virginia, have also pushed for Medicaid expansion trigger laws since President Donald Trump resumed office in 2025.

“It requires the state to eliminate coverage,” Adam Searing, an associate professor of practice at Georgetown University’s McCourt School of Public Policy, told me. “There’s not going to be a debate in the state about it. It’s not going to be up to the legislators.”

Federal matching funds were set up to incentivize states to adopt Medicaid expansion when the Affordable Care Act was passed in 2010, minimizing the impact on state budgets, explained Sharona Hoffman, professor of law and bioethics at Case Western University and co-director of the university’s Law-Medicine Center.

Right-wing policy think tanks including the Heritage Foundation and the Paragon Health Institute have advocated for cuts to federal matching funds that would set trigger laws into motion. The nearly $1 trillion in cuts to Medicaid in Trump’s 2025 budget bill, the so-called “One Big Beautiful Bill Act,” which involves implementing work requirements and reducing services and funds, has encouraged GOP state legislators across the country to move in just that direction.

“I do think that state policymakers, for the first time in a long time, are paying very, very close attention to the relationship between federal portions of the budget and really what the state is responsible for,” said Natasha Murphy, director of health policy at the Center for American Progress.

But their counterparts at the federal level haven’t succeeded in reducing Medicaid matching funds below 90 percent, despite an effort led by Sen. Rick Scott (R-Fla.) that would have amended OBBA to that end.

If South Dakota passes the law and federal matching is ultimately lowered, Murphy said, the outcome for the state will be disastrous—as it would be in the states that have already passed trigger laws.

“There is a trickle-down impact that has on healthcare providers and hospitals and health systems,” Murphy said. “In a state like South Dakota, where you know you have a very [substantial] rural population, this is just going to compound.”

But compared to the rhetoric around federal Medicaid cuts—where GOP legislators have largely denied the intent to reduce services or cut off many of their constituents, despite the clear impact. Searing grants that Medicaid expansion trigger laws are less deceptive.

“They at least have to admit, ‘Hey, we are holding the steering wheel here, and we’re going to cut people off of their health insurance if we don’t get enough money from the federal government,” Searing said. “[OBBA] cuts are more insidious. [But] I don’t think either of them is a good thing. It doesn’t make any sense to have more people uninsured.”