Last month (May 2025) saw the long-dreaded release of the House GOP’s proposed Medicaid cuts, raising alarms and critical questions from many in California and across the country. We broke down what’s going on, what Congress was considering, and why Medicaid cannot be undermined. Then, we hosted a live Q&A to get your questions answered.

About the Town Hall

The Budget Reconciliation Bill (The “Big, Beautiful Bill”) passed the House of Representatives on May 22 and progressed to the Senate. These cuts in the bill will be the largest Medicaid cuts in history and, if enacted, the next 10 years will see $715 billion in cuts and 14 million people losing vital health care coverage. This is not just a budget cut, it’s severing a lifeline to millions of Americans.

Every day, Disability Rights California (DRC) receives calls from Californians concerned about how these Medicaid cuts will affect their well-being. These cuts will hurt our clients and community members by removing them from eligibility or reducing services for those who remain eligible.

In response to this influx of questions, we hosted an emergency town hall covering:

• What is Medicaid and why does it matter? 
• What is going on in Congress right now? 
• What is the proposal that Congress is considering? 
• How does the budget reconciliation process work? 
• Where are things in the process?

Then, we hosted an open Q&A session with our panel of engaged experts about the proposed cuts to Medicaid. 

Watch the Town Hall

Town Hall Q&A: Federal Medicaid Proposals 

*These answers are up to date as of May 29, 2025. 

Is Congress voting to cut any programs completely? 

• No, Congress is not considering completely getting rid of Medicaid across the country. Other programs under Medicaid are state-specific. There are no state programs that would have to go away completely if the federal bill passes. Instead, it would be up to the state to decide how it wants to handle the cuts.  

Are mental health services affected by federal Medicaid cuts? 

• Many people receive mental health services through Medicaid. The federal Medicaid bill would make it harder to access these services in three ways: 
  • First, there would be extra administrative burden for individual consumers on Medicaid trying to navigate services. 
  • Second, the state would have less money to spend on Medicaid overall, so certain mental health services that are optional under federal law would be at risk for cuts. 
  • Third, these policies would worsen the shortage of mental health providers, especially those that see patients with Medicaid. 

How will these cuts affect California Children Services (CCS)? 

• The federal proposals do not directly affect CCS. However, with less money from the federal government to spend on Medicaid, the state could decide to make changes to CCS.  

How might The Lanterman Act shield us from the impact of these cuts on Medi-Cal? 

• The Lanterman Act is a state law that provides an entitlement to services for people with certain developmental disabilities. 
• The federal Medicaid cuts will not make the Lanterman Act go away. The Lanterman Act will still be the law in California. 
• In the past, when the state faced difficult budget times, the state limited what services people can receive through the regional centers. We do not know if this will happen again. If it does, we will look closely to see if the extra limits violate the Lanterman Act. 

How will regional center services be affected by these cuts?  

• The regional center system receives more than 1/3 of its funding from federal Medicaid funds. The regional center system bills Medicaid for certain services for consumers that are eligible for Medicaid. One of the ways that the regional center bills Medicaid is through the HCBS-DD 1915(c) waiver. 
• The federal cuts would not directly take away regional center services. However, we are concerned that, with less federal funding for Medicaid coming to California, the state could decide to cut funding to regional center services. We do not know exactly what those cuts would look like.  However, we will work to preserve regional center services for Californians with I/DD.  

How will the Self-Determination-Program (SDP) be affected by these cuts? 

• Similar to other regional center services, a portion of funding for SDP comes from federal Medicaid funds. Again, the proposals in Congress would not directly cut SDP, but if the state has less money to spend on Medicaid, the state may try to limit spending on SDP. 

Will Governor Newsom adjust the California budget based on federal cuts to Medicaid? 

• Yes, the federal cuts to Medicaid would have a major impact on California’s budget. The Governor recently estimated that California would lose $30 billion in federal funding.  
• When faced with a budget shortfall, the state has two choices: 
  • The state can cut spending, which often looks like cuts to social services. 
  • The state can find more revenue, such as through taxes or the rainy-day fund. 
• Changes to state spending have to go through the state legislature. This means that we will have a chance to hear about proposed changes and fight back if they are bad for people with disabilities.  

How will the proposals in Congress affect California’s Medi-Cal 1915(c) Waiver programs, like the Assisted Living Waiver program and the Home and Community Based Alternatives Waiver?  

• The federal Medicaid proposals do not directly cut these programs. However, these programs are considered optional under federal Medicaid law. Therefore, if the state has less money to spend on Medicaid overall because of these federal cuts, the state may look to these “optional” programs to cut spending. 
• We do not know yet if this will happen. However, we know that these programs provide essential services for many Californians, and we will monitor and, if needed, fight against cuts to these programs.  

How will these cuts affect veterans? 

• Many veterans receive health care and other services through Medicaid. Check out our fact sheet on this topic to learn more: Fact Sheet: How does Medicaid/Medi-Cal Affect Veterans. 

Are there non-disabled orgs we can partner with? 

• Yes, because Medicaid affects everyone, many groups are fighting to protect Medicaid right now! Some of the groups that we are working with include health care providers, labor unions, and hospitals. We are glad to have many allies in this important fight. 
• For example, the National Health Law Program (NHeLP) has great resources related to protecting Medicaid and Medi-Cal funding: Medicaid Defense - Resources and Analysis - National Health Law Program .

How will this affect CalAIM? 

• CalAIM is a managed care program that is supported by a 1115 demonstration. The 1115 demonstration has to be approved by the federal government. Congress is proposing adding more requirements for 1115 demonstrations, which may require changes to CalAIM. We do not know exactly what those changes would look like yet.  

If there are different types of Medicaid for different eligibility groups, would only certain people need to recertify bi-yearly, or does this rule apply to everyone in general on Medicaid? 

• The need to recertify twice a year would only affect people who get Medicaid via the Affordable Care Act expansion, also known Modified Adjusted Gross Income (MAGI) Medicaid. 
• More than 1/3 of Californians on Medi-Cal qualify via this enrollment pathway. 

How soon can we see the impact of these cuts if they pass? 

• The federal cuts would take effect for the upcoming federal fiscal year, which starts in October 2025. However, not all the policies take effect immediately. For example, the work reporting requirements would take effect by December 31, 2026.  

How likely is the federal budget to pass in this form?  

• We can’t say exactly how likely the federal budget is to pass. Right now, the bill is in the Senate, and they are likely to make some changes to the version that passed in the House. It is important to know that this bill has not passed yet, so it is not final. Congress can be unpredictable, so don’t give up hope. In this moment, we need to keep the pressure up, not back down in resignation.  

How can we advocate? How can we talk to Congress? 

• If you are concerned by these proposals in Congress, you can contact your member of Congress. You can find their contact information here.  
• DRC has put together a tool specific to Medicaid that you can use to contact Congress as well: Tell Congress Today: Disabled People Are Counting on You to Protect Medicaid. 
• We encourage you to share personal stories about why Medicaid matters in your life with policymakers. 

Are there going to be any other meetings regarding this matter? 

• You can join our email list or check our social media to learn more about upcoming events related to Medicaid. DRC is committed to keeping the community informed about federal policies that may affect disabled Californians.  

What other resources do you recommend? 

• AAPD Medicaid Defense Hub 
• DREDF Hands Off Our Medicaid 
• Medicaid Guide by the Autistic Self Advocacy Network