Medicaid is on the chopping block. As Republicans on Capitol Hill try working through the details of their budget plan, the U.S. Congressional Budget Office has confirmed that achieving the level of spending cuts sought by the GOP will require steep cuts to the program. The House Committee on Energy and Commerce has been charged with making $880 billion in spending reductions from the programs over which it maintains jurisdiction. Certain large programs under the committee’s purview are deemed politically out-of-bounds—such as Medicare, which is federal health insurance for people age 65 and over (and for some people under 65 with certain disabilities and conditions).
Instead, it’s the 72 million Americans receiving Medicaid—a joint federal and state program that covers medical costs for people with limited resources—who are most likely to feel the bite.
Going after Medicaid will be dangerous, since the program has unexpectedly emerged as one of the most essential components of the country’s national health care system. According to the Congressional Budget Office, it constitutes $8.2 trillion of the $8.8 trillion of the committee’s 2023-2034 budget (excluding Medicare). Medicaid has provided health care for tens of millions of Americans deemed to be “medically indigent”—meaning that they are unable to pay for their services—as well as those who are physically disabled.
Unlike so many issues in our politics, Medicaid does not abide by the partisan color line. There are 72 million people receiving benefits. More than 40 percent of births take place with Medicaid dollars, which also pays for half of long-term nursing care. In certain respects, all Americans are Medicaid beneficiaries in 2025. According to the Kaiser Family Foundation, 40 percent of Americans want Medicaid funding to stay the same, 42 percent think that it should be raised, and only 17 percent believe that the numbers should go down.
Indeed, sizable numbers of voters who President Donald Trump attracted into his coalition—particularly working Americans who are struggling to survive in the modern economy—depend on Medicaid, which is the creation of former Democratic President Lyndon Johnson. Recent data from the New York Times showed that more than 40 percent of the population in a reliably Republican area of rural Kentucky depends on Medicaid. One-third of the constituency in Louisiana Republican Rep. Julia Letlow’s district received Medicaid.
As War Room podcast host Steve Bannon recently warned in an interview, “A lot of MAGA’s on Medicaid. If you don’t think so, you are dead wrong. You can’t just take a meat axe to it.”
When Congress created Medicaid through the Social Security Amendments of 1965, legislators likely never imagined that it would become a major program.
In fact, it was barely discussed. Most of the political debate centered on Medicare—hospital insurance coverage for elderly Americans that would be incorporated into the Social Security system. The federal government would administer Medicare, paid for through Social Security taxes, and coverage would be universal, so that anyone covered under Social Security received the benefit.
Medicaid actually originated with conservative legislators who were sympathetic to the American Medical Association’s attacks on Medicare as “socialized medicine,” and who for years had pushed a smaller, means-tested program that aimed to stave off demands for something bolder. For instance, in 1960, Oklahoma Sen. Robert Kerr and Arkansas Rep. Wilbur Mills, the chairman of the powerful House Ways and Means Committee—both Democrats—had pushed a rather meager program called Medical Assistance for the Aged, modeled on public welfare, which involved a means test.
But when the political climate changed after the 1964 election, after Johnson enjoyed a landslide victory over Republican Sen. Barry Goldwater and Democrats obtained massive majorities in the House and Senate, Congress moved forward to pass an ambitious heath care plan that included Medicare A (hospital insurance for Americans 65 and over, paid for by Social Security taxes), Medicare B (physicians insurance for Americans 65 or over, paid for by general tax revenue and contributions from those who wished to receive benefits), and Medicaid (an extension of the Kerr-Mills Act).
Under Medicaid—the part of the legislation that received the least attention—federal and state funds would assist elderly Americans who could not pay for their medical expenses through their existing income. This was an expansion of the Kerr-Mills program that Congress enacted five years earlier. Mills, who had stood as the chief obstacle to Medicare until 1965, changed his tune once it was clear that larger and liberal Democratic majorities, along with the bulldozer of a President Johnson, were going to succeed with or without him. Mills seized the spotlight by putting together a package more grandiose that what Johnson had envisioned.
While Medicaid started as a footnote, though, the program quickly expanded. Under Gov. Nelson Rockefeller, New York quickly capitalized on this barely noticed measure. Using state authority to expand rather than contract policy (as Southerners had done with anything related to civil rights), the state’s Department of Social Services coordinated with local districts to liberalize eligibility to the program and expand the range of benefits.
As one aide to then-New York Sen. Jacob Javits explained to the New York Times, “Congress had absolutely no idea Title 19 [of the Social Security Amendments of 1965, Medicaid] could turn into a multi-billion-dollar program approaching national medical insurance.” Fiscally conservative members of Congress, such as Mills, were so frustrated by New York’s actions that they passed legislation in 1967 in an attempt to force the state to reduce benefits and curtail the number who were eligible. The federal crackdown, however, had limits.
Medicaid continued to grow. In 1972, Congress passed the Supplementary Security Income program (SSI) which combined a number of cash-assistance programs run by the states into a single program run by the federal government.
At the same time, Medicaid did continue to come under pressure as politics shifted rightward. In 1977, the House passed Republican Rep. Henry Hyde’s amendment restricting the use of Medicaid funds to finance abortion (other than in the cases of rape, incest, or danger to the mother’s life). President Ronald Reagan’s 1981 budget removed many working Americans from Medicaid and reduced the types of coverage that could be provided by the states. Within some conservative states, elected officials took advantage of federal guidelines to further shrink coverage. These were significant changes, though Congress rejected Reagan’s proposal effort to turn Medicaid into a block grant.
Yet in this era of retrenchment, other forms of liberalization continued. In 1982, Arizona finally embraced the program, thereby ending its role as the final state to hold out from participation. During the 1980s and 1990s, Medicaid expanded by incorporating new categories of citizens such as pregnant women and infants. Several states capitalized on federal waivers to introduce home- and community-based services for beneficiaries.
As the political scientists Colleen Grogan and Eric Patashnik argued in a 2003 article for the Journal of Health, Politics, Policy and Law, policymakers won support for the expansions by focusing on parts of the population perceived to be “deserving” of help and by justifying the changes on the grounds that Medicaid was economically efficient.
The political strength of the program had become evident by 1995-1996, when it was one of the programs that then-President Bill Clinton defended when he attacked the Republican budget during a prolonged federal shutdown. Almost 36 million Americans benefited from Medicaid by 1996—compared to about 23.5 million in 1989.
In 1997, Clinton won support from a Republican-led Congress for the State Children’s Health Insurance Program, which offered health care services to children whose families earned too much to qualify for Medicaid. A few states included pregnant women under the same economic circumstances.
The final period of major expansion took place with the Affordable Care Act, signed into law by President Barack Obama in 2010. The ACA authorized states to expand eligibility upward to people who had incomes that reached 138 percent of the federal poverty level. While the original legislation mandated this change, the Supreme Court ruled in 2012 that states had the option of doing so.
For some time, red states resisted the change—despite immense pressure from their electorates, health care institutions, and elected officials to take the offer. Over time, the resistance withered as the Affordable Care Act provided another boost to Medicaid; by the end of 2024, 41 states and the District of Columbia had undertaken the expansion. Medicaid enrollment boomed further during the COVID-19 pandemic, when Congress boosted funding and required states to maintain continuous enrollment until Congress deemed that the public health crisis ended, which ultimately occurred in 2023.
In 2025, Medicaid is a major health care program that affects millions of Americans and has become integral to health care, health care systems, and the budgets of state governments. So successful has this been that even many conservatives don’t consider this to be an example of “big government.”
Should Republicans really decide to take a deep bite into this program to pay for the extension of Trump’s tax cuts, then they risk losing the goodwill of many voters who believed in Trump’s promise of a new conservative populism.
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