Healthcare leaders are working to preserve cuts to Medicaid funding as states deal with budget shortfalls and federal funding cuts.
Advocacy has picked up in recent months after Congress passed the federal budget earlier this year, which aims to reduce Medicaid spending by $1 trillion over the next 10 years. Healthcare leaders have warned that these cuts could put dental funding on the chopping block first because these benefits are optional.
Here are two states where Medicaid dental funding is at risk:
1. The California Dental Association recently advocated for the state to delay proposed cuts to Medi-Cal dental funding until 2026. Gov. Gavin Newsom proposed eliminating funding for Medi-Cal dental services and dental coverage for undocumented immigrants and redirecting the funds to address that state’s $12 million budget deficit. The legislature rejected the proposal, delaying any cuts until July 1, 2026.
While the state has avoided any immediate cuts to dental services, new concerns have emerged due to the new federal budget that slashed federal funding for California. The federal government covers nearly 60% of the cost of Medi-Cal, according to a news release from the CDA. Because the federal budget aims to reduce Medicaid spending by $1 trillion over the next 10 years, the state’s Medicaid budget remains at risk.
“As the federal government continues to move toward massive cuts to Medicaid, California must do all it can to protect the 15 million patients who rely on Medi-Cal,” CDA President Max Martinez, DDS, said.
2. Colorado’s Medicaid dental budget faces an uncertain future after Gov. Jared Polis cut funding and proposed additional measures to fill the state’s budget shortfalls.
Gov. Polis issued an executive order in September to help reduce the state’s $750 million budget deficit. The executive order included more than $89 million in budget cuts for various programs, primarily affecting healthcare providers. The order resulted in a $2,500,000 cut to dental rates and a rollback of the state’s 1.6% reimbursement rate increase.
The governor told lawmakers during a recent budget meeting that the cuts were “just the tip of the iceberg.” Then, in November, the governor proposed capping some reimbursement rates and limiting dental benefits in an effort to save the state additional money and prevent cuts to other state services.
The governor’s budget proposal for the 2026-27 fiscal year calls for several measures, including prior authorization for more services, cost sharing and additional payment caps. The state used to have a $1,500 annual cap on Medicaid benefits. Under the proposal, the state would reinstate a cap, but at $3,000 instead of $1,500.
