Full Breakdown
Idaho Governor Approves $22 Million in Medicaid Disability Budget Cuts
3/28/2026, 11:09:25 AM
Overview of the Budget Cuts
Idaho Governor Brad Little has signed House Bill 863, which implements nearly $22 million in budget cuts to Medicaid disability services. The legislation, which passed through both the Idaho House and Senate, primarily reduces provider reimbursement rates for residential habilitation services by $21.8 million for the upcoming fiscal year. This decision is part of a broader effort by state lawmakers to balance the budget, which has seen significant cuts across various government sectors, with Medicaid being largely spared until now.
Legislative Context and Decision-Making
The cuts were proposed as a means to address budgetary constraints, with lawmakers framing the decision as a choice between reducing Medicaid expansion or cutting services for individuals with disabilities. The bill faced initial delays, but after an alternative proposal to repeal Medicaid expansion was introduced, the revised bill for disability cuts was approved by the House without debate. However, it encountered more resistance in the Senate, where patients and providers voiced their concerns.
Stakeholder Perspectives
Katie Hodges, a recipient of residential habilitation services, expressed her fears about the impact of the cuts, recounting her past experiences of institutionalization. She urged lawmakers to reconsider their decision, praying for wisdom in their choices. Jodi New, the owner of Teton Supported Living, warned that the cuts could force some providers to shut down, while Ritchie Eppink, the lead attorney in the KW v. Armstrong lawsuit, cautioned that the cuts might expose the state to increased litigation risks.
Legislative Vote and Opposition
The Senate ultimately passed the bill with a narrow 19-15 vote, where nine Republicans joined the six Democrats in opposition. Senator Brian Lenney criticized the cuts, arguing that true fiscal conservatism would seek alternative funding sources rather than jeopardizing services for vulnerable citizens. In contrast, bill cosponsor Senator Julie VanOrden defended the cuts, suggesting that providers could manage with reduced funding while still compensating their staff adequately.
Implications of the Cuts
The approved cuts, combined with previous reductions, will result in a 10% decrease in reimbursement rates for residential habilitation providers. Despite these reductions, proponents of the bill assert that reimbursement rates will remain 33% higher than they were four years ago. The long-term effects of these budget cuts on service availability and provider sustainability remain uncertain, raising concerns among advocates for individuals with disabilities.
Verbatim Quotes
- “Lord, I pray that they make the right decision.” — Katie Hodges, Medicaid recipient
- “Real fiscal conservatism would find the $21.8 million somewhere else that doesn’t involve breaking a promise we made to the people caring for Idaho’s most vulnerable citizens,” — Senator Brian Lenney, R-Nampa
- “The money follows from the state to the providers to the caregivers. Somewhere along there, maybe somebody needs to tighten the belt somewhere,” — Senator Julie VanOrden, R-Pingree
