Congress plans to slash Medicaid, which could cost Colorado $1 billion. They should be doing the opposite. If they move forward with cuts, Colorado’s lawmakers will likely need a special session to try to save this vital program.
As primary care physicians and health policy researchers, we see the benefits of Medicaid coverage for our patients every day. We also see where proposed changes and cuts will create barriers for our patients to access the affordable care that keeps them healthy and able to work.
After an all-night session May 22, the House passed a budget reconciliation bill that would make nearly $800 billion in cuts to Medicaid. One of the major changes would be the implementation of work requirements for working-age adults without children starting Dec. 31, 2026. The changes to Medicaid would result in at least 7.8 million more Americans not having health insurance by 2034. The bill still awaits final action in the Senate, but a version put forward by the Senate Finance Committee on Monday would expand work requirements even further to include adults with dependent children over age 14.
Changes to Medicaid that lead to people losing coverage will harm the economy. Not only does Medicaid provide essential health care coverage to 71 million seniors, families, and children, but it also drives local economic growth.
Colorado’s Medicaid expansion increased the state’s economic activity by $3.8 billion in just the first two years. In that time, average household earnings rose by $643, and the state created 31,074 new jobs. By 2025-26, the expansion was projected to generate nearly $4.4 billion in additional economic activity.
Nationally, Medicaid expansion improved workers’ productivity and job prospects, while cutting their medical debt. Every dollar the government spent expanding Medicaid access for children resulted in a return of $1.78 — more than paying for itself.
Losing Medicaid coverage creates financial instability. People without health insurance are more likely to miss work because of sick days, creating a ripple effect that harms the economy.
This effect is most profound in small towns and rural communities, where Medicaid covers a higher percentage of children and adults than in big cities. The program is critical to keeping many rural hospitals and health centers in business. This contributes to the region’s economic health as well as physical — since these hospitals are often the largest local employers.
Legislation currently under consideration would require adults covered through Medicaid expansion that have incomes 100%-138% of the federal poverty level to pay up to $35 for some health care services. Many of our patients can’t afford a $2 copay for their medicines.
The legislation also would require adults ages 19-64 to be working, in job training, or volunteering at least 80 hours a month to keep their Medicaid coverage, unless they meet certain exemptions.
Most patients we see covered by Medicaid are already working at least part time or would meet exemptions, which is the case across the country. Almost all (93%) of working-age adults covered by Medicaid are working full or part time, including in jobs where they can’t get insurance through their employer, or not working because they are caregiving for others, ill, disabled or in school. Work requirements will create bureaucratic red tape that will lead to people losing coverage despite their eligibility.
Monitoring eligibility for work requirements will also increase administrative costs for states. In Arkansas, it cost $152 per enrollee to implement work requirements. Based on those numbers, Colorado estimates implementing work requirements could lead to more than $57 million in administrative costs.
The role of Medicaid in supporting the economy is often overlooked, as are several other assets of the program. Medicaid is remarkably efficient — 96% of Medicaid funding goes directly to pay for health care services, and only 4% is used for administrative overhead. In private insurance, on the other hand, administrative overhead eats up an average of 17%.
As Congress finalizes budget decisions, it is critical that lawmakers look elsewhere for options on what to cut. Medicaid provides crucial health insurance coverage for millions of Americans and bolsters state and local economies. Most Americans, on the right and the left, don’t think Medicaid should be cut.
If these cuts pass, Colorado must defend Medicaid — ensuring more Coloradans stay healthy, able to work, and out of medical debt.
Dr. Stephanie Gold, of Denver, is a family physician and health policy researcher at the Farley Health Policy Center, where her policy work focuses on improving health and well-being for all through payment reform and system transformation.
Dr. Kyle Leggott, of Aurora, is a family physician and health policy researcher at the Farley Health Policy Center, focusing on the intersection of policy with state-based health care legislation.
Dr. Lauren S. Hughes, of Denver, is a practicing family physician and the state policy director of the Farley Health Policy Center. Her research interests include strengthening primary care, improving rural health care delivery, and integrating behavioral health in safety net clinics.
Dr. Apoorva Ram, of Denver, is an internal medicine physician who practices as a primary care physician and is a health policy researcher at the Farley Health Policy Center, where her research focuses on access to care and primary care reform.
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