Children. People with autism and other lifelong disabilities who cannot live independently. Elderly and disabled people dependent on home care or live in nursing homes. Low and moderate-income adults who don't get insurance through their jobs.
This is the spectrum of New Jerseyans who would be affected by the bone-deep cuts to the Medicaid program that would likely take place under the proposal by Congressional Republicans to slash $880 billion from the entitlement program over the next decade.
Gov. Phil Murphy's administration estimated New Jersey's loss at $5.2 billion a year, according to a new memo from state Human Services Commissioner Sarah Adelman.
The proposed cuts, coupled with a change of rules governing who may qualify for Medicaid, could lead to the loss of coverage for 700,000 people, Adelman's memo posted on the state website Friday evening said.
"The proposed federal Medicaid funding changes would have devastating consequences for New Jersey residents, health care systems and providers," Adelman's memo said.
"Our Medicaid program ensures that 1.8 million New Jerseyans -- children, working families, older adults, and individuals with disabilities -- receive critical health care services," Adelman added. "Reductions in federal funding, whether through cuts to matching rates or eligibility restrictions, could result in billions of dollars in lost support, jeopardizing access to care, forcing difficult choices in provider payments, and straining our state's health care infrastructure."
The federal Medicaid cuts have been proposed as a way to pay for expiring tax cuts from President Trump's first term.
New Jersey's Medicaid program, also known as NJ FamilyCare, serves 1.8 million people who are low-income, disabled, or both. The total cost of the program is $24 billion, with $10 billion funded by the state and $14 billion by the federal government, according to Human Services data.
Medicaid coverage is vast. It includes hospital care, physician and dental care, prescription drugs, nursing home and home care for the elderly and disabled, mental health care and substance abuse treatment and community-based services for people with developmental disabilities. Nearly one-third of all babies are covered by the program.
The state and federal share for reimbursing these services varies. The federal government, for instance, pays for 90% of the cost of insuring low-income adults covered under Affordable Care Act, 65% of the cost for moderate to low-income children and 50% of the cost for most other NJ FamilyCare members, the Human Services' memo said.
But those allocations would likely change, putting pressure on the state to find the money to cover the cost or eliminate people from the program. If the state lost the 90% match for people covered by the ACA, New Jersey would lose $2.2 billion. If the state lost the 50% match, that would cost New Jersey $2.3 billion.
One cost-cutting idea floated by Congressional Republicans is to require adults to work a minimum number of hours to qualify for Medicaid.
A study by the Kaiser Family Foundation found 64% of Medicaid recipients were already working full-time or part-time, 12% did not work because they were taking care of a disabled or sick family member and 10% were sick or disabled themselves.
Currently, eligibility is based household size, income and financial assets, age, disability status and residency status. Undocumented immigrant adults do not qualify for Medicaid/FamilyCare. Children of undocumented children have qualified for FamilyCare since 2023. People must verify they still qualify for the program every year.
Hospitals would feel the pain, too, with the loss of matching funds. Atlantic Health System and its seven facilities could lose $32.5 million to $101.1 million. RWJ Barnabas Health and its 13 facilities could lose as much as $650.4 million.
"It's crucial for stakeholders, advocates, policymakers, and recipients to fully understand the potential repercussions on health care and services if these proposals are enacted into law," Adelman said. "We urge Congressional leaders to protect the integrity of Medicaid and uphold the commitment to those who rely on it every day."
New Jersey is not in the fiscal position to offset these losses. Murphy's final budget as governor, which he will announce on Tuesday, is facing a potential $3.7 billion structural deficit, sources have told NJ Advance Media.