Medicaid Monitor
Policy Intelligence
Medicaid Monitor
Policy Intelligence
Updated 6:49 AM MT
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Federal Policy·August 7, 2026

Federal Medicaid Cuts and State Budget Pressures Threaten Home- and Community-Based Services for Disabled Americans

The One Big Beautiful Bill Act reduces federal Medicaid funding, prompting states to cut home- and community-based services (HCBS) that allow people with disabilities to live outside institutions. Maryland and other states have enacted or proposed HCBS reductions in response to federal funding cuts and state budget shortfalls. Federal officials have also walked back longstanding requirements that states deliver disability services in community settings rather than institutions. Advocates report the combined federal and state actions reverse decades of policy favoring community integration over institutionalization for disabled Medicaid beneficiaries.

Why it matters

Federal Medicaid cuts in the One Big Beautiful Bill Act force states to reduce HCBS funding, directly affecting LTSS service delivery, eligibility, and institutional placement rates for millions of Medicaid managed care enrollees with disabilities.

LTSS · Managed Care

Read the full article at idahocapitalsun.com

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