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Significant cuts to D.C. Medicaid could be coming down the pipeline amid the city's $1 billion budget shortfall and a proposal in Congress that might wipe billions of federal dollars from the health care program, the head of the District's health care finance department said.
D.C.'s Medicaid program, which provides health care to nearly a quarter of D.C. residents, is facing "unprecedented challenges", Wayne Turnage, the director of D.C.'s Department of Health Care Finance (DHCF), said in a public notice Monday. Turnage is also the deputy mayor for D.C.'s Health and Human Services.
Turnage said a Medicaid budget gap of more than $173 million for Fiscal Year 2026, a decline in forecasted revenue and the potential federal cuts mean DHCF's budget proposals could "fundamentally reshape the District's Medicaid program."
D.C.'s Medicaid eligibility, benefits and provider rates are all "on the table," he said in the notice.
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More than 264,000, are on Medicaid, according to health policy nonprofit KFF. Medicaid covers four out of five nursing home residents in the city, and three out of seven children. Nearly 60% of adults on Medicaid in D.C. are working, and the vast majority of enrollees are people of color.
"Due to projected spending growth for Medicaid in FY2026, it appears that the Department of Health Care Finance must propose reductions of at least $173 million in local funds to balance its Medicaid budget. These reductions are separate and apart from additional decreases that may be necessary should the Congress reduce federal Medicaid funds to the District in FY2026 and beyond," Turnage said in a statement to News4.
"Despite these significant challenges, the mission of DHCF remains the same — to improve health outcomes by providing access to comprehensive, cost-effective, and quality healthcare services for residents of the District of Columbia and we will continue to do so this year, even in uncertain times."
It's unclear when any Medicaid cuts would come to fruition and which recipients would be affected.
Below is the full public notice from Turnage about the budget challenges:
"I am writing to you today about the unprecedented challenges the District’s Medicaid program faces and how this will shape the budget proposals that we submit to the City Administrator and the Budget Director. As I shared during DHCF’s oversight hearing last week, the growth patterns in the Medicaid program for FY2025 alone will require over $173 million in additional local funds for FY2026 – amounting to nearly $580 million over the District’s four-year financial plan."
"The news from the Office of the Chief Financial Officer on February 28, 2025, which forecast a decline in revenue by more than $1.1 billion over the four-year financial plan, significantly exacerbates the challenges we will face in constructing budget proposals for next year’s Medicaid program. Moreover, there remains much uncertainty about whether and how Congress will reduce the flow of federal dollars to State Medicaid programs. The pending budget instructions for the House could shift Medicaid costs away from the federal government and to the District by $8 billion over 10 years, though the methods for achieving these savings remain unclear. Clearly, a local fund Medicaid budget gap for FY2026 of more than $173 million, a decline in forecasted revenues, and some measure of a federal fund reduction, will require DHCF to make budget proposals that if enacted, will fundamentally reshape the District’s Medicaid program."
"Over the past few years, DHCF has implemented various efficiencies and targeted reductions to meet budget marks that were designed to slightly reduce the financial footprint for the program. Those options are now exhausted. As I noted in my testimony to the Committee on Health, the cost of the Medicaid program is directly impacted by decisions regarding program eligibility, benefits, and provider rates. The fiscal pressures now facing the city mandate that we consider options across all three of these factors. In short, everything is on the table."
Go here to read more about Medicaid and what potential cuts could mean.
