New Jersey Officials Warn of $3.7B Annual Medicaid Funding Loss
New Jersey Human Services Commissioner Stephen Cha told state senators the state could lose up to $3.7 billion in annual federal Medicaid funding by the end of the decade, driven largely by cuts to state-directed payments for hospitals and doctors under the 2025 federal reconciliation law. Officials estimate up to 330,000 people could lose NJ Family Care coverage, which could cut provider reimbursements by an additional $2 billion to $3 billion annually. Starting in January, 540,000 low-income adults must document 20 hours per week of work, school, or volunteering to keep benefits, with limited exemptions and new six-month re-enrollment requirements; New Jersey is among states challenging these rules in court. Even under an optimistic scenario, the state projects at least $1.8 billion in annual losses and 165,000 newly uninsured residents.