Alliance Alert: Congress is advancing a Medicaid overhaul that could devastate New York. The proposals advanced by the House Energy and Commerce Committee yesterday would slash more than $700 billion from Medicaid nationwide, causing thousands of New Yorkers to lose their coverage—coverage that funds essential services like hospitals, children’s health, elder supports, mental health and substance use supports, and other disability services.
Medicaid makes up 43% of New York’s state budget, and these cuts would force community hospitals, nursing homes, and health centers to close or scale back. They would also hit school-based health services, programs for children with disabilities, addiction treatment providers, and foster care agencies. These services are not luxuries—they are lifelines.
Key threats include:
- Work requirements that act as bureaucratic traps, pushing working people off Medicaid simply because they miss paperwork deadlines.
- Cuts targeting undocumented New Yorkers, children, and the elderly, forcing the state to choose between cutting coverage or backfilling lost federal funds.
- Elimination of New York’s MCO tax, which helps fund payment rate increases to hospitals and providers, putting billions of already-allocated federal dollars at risk.
- Penalties for using state funds to cover undocumented people, potentially stripping insurance from tens of thousands—including children.
The federal government’s proposal to dismantle New York’s Medicaid financing mechanisms and penalize the state for inclusive health coverage is both punitive and short-sighted. These changes would reverse years of progress and exacerbate a crisis in our already underfunded safety-net systems.
The result?
- More ER visits
- More hospital closures
- More strain on nonprofit providers
- Higher state taxes and service cuts
- And a dramatic rise in poverty across urban, suburban, and rural communities
Even moderate Republicans have raised red flags, recognizing how deeply these cuts would hurt constituents. As Senator Josh Hawley warned about national cuts, “Hospitals will close. It’s that simple.”
We cannot allow Washington to dismantle our health care infrastructure.
ACT NOW!
- Contact your congressional representatives, especially Republicans, and urge them to oppose Medicaid cuts.
- Defend inclusive health coverage—we must not let immigrant communities and low-income children be sacrificed.
- Mobilize your networks—use your voice, your organization, and your community to stand up for Medicaid.
To help these efforts, the Alliance for Rights and Recovery has launched an action alert system to help community members across the country contact their representatives and urge them to protect Medicaid.
Send your message today:
ACT TODAY
We need Congress to hear from the people who rely on Medicaid—not just lobbyists or political strategists. Let’s protect our health coverage, our services, and our communities.
Medicaid is a cornerstone of health equity in New York. We must fight these harmful proposals and defend the right to health care for all.
Op-ed: Proposed Medicaid Cuts Will Devastate New York
Richard Buery | Crain’s Health Pulse | May 12, 2025
In 1975, New York City was in financial turmoil, and a now-famous headline described President Ford’s federal response: “Ford to City: Drop Dead.” Since then, we’ve overcome threats from 9/11 to market crashes to hurricanes to a global pandemic. Not only is New York still kicking, but we’ve continued to grow and thrive. But now, a new challenge threatens New York — and this time the problem isn’t the federal government’s failure to respond: Washington is itself the threat.
Congress is considering cuts that could cause 2 million or more New Yorkers to lose their health insurance, 3 million to go hungry, 50,000 children to lose day care, and 600,000 to see already unaffordable housing costs skyrocket.
Medicaid alone constitutes 43% of the state budget, and significant cuts will cause community hospitals, elder care providers, foster care agencies and drug treatment programs to close or reduce service. Many students with disabilities rely on Medicaid for the vital services that allow them to learn alongside their peers.
These cuts will be felt in every corner of the state. For example, two congressional districts with rising poverty rates — Rep. Mike Lawler’s district in Rockland County and Rep. Nick LaLota’s district on Long Island — together have over 35,000 residents who stand to lose access to food and a quarter-million who could lose health care. Meanwhile, upstate farmers are dealing with a freeze of $186 million in promised federal funds, including funds to purchase locally grown produce for food banks — hurting both farmers and the poor.
Consider a working single parent relying on Head Start for childcare, Section 8 for housing and Medicaid for health care. Eliminating one destabilizes; eliminating all three destroys. Washington’s policies would push such families deeper into poverty, and could result in the largest increase in poverty since the Great Depression.
While the impact will fall disproportionately on the poor, all New Yorkers will feel the pain. New York will need to consider raising taxes and cutting other spending to fill the gaps. The result: less funding for schools, public safety, subways and buses, roads, housing and other critical priorities. Our state will become less affordable and less safe, and families and employers will be driven away. Every employer — indeed — anyone who cares about the economic health of New York, should be alarmed.
Further, federal cuts threaten the over 13,000 nonprofits we will need to try to fill the gaps. Not only do these groups teach our children, care for the sick, expose us to the arts and feed the hungry, they are core to our state’s economy, providing 1 of 6 private sector jobs and paying $97 billion in wages.
Many have already had federal funds frozen and now face even deeper cuts. Worse, some are now threatened with having their tax status revoked or being called before Congress. Many will be forced to close their doors. You might not receive direct services from these groups, but you will feel it once they are gone.
With this runaway train hurtling north from Washington, we need business leaders to raise the alarm. It is not too late to stop it. We can choose to live in a society that invests in the infrastructure of opportunity, or we can self-inflict economic misery on millions and tank our economy in the process.
Recent reporting indicates that House Speaker Mike Johnson is backing off from the deepest Medicaid cuts due to pressure from moderate Republicans — including those from New York. It would take just a few votes in the House and Senate to avoid this man-made catastrophe. I urge business leaders to join me in calling on Washington to do right by Americans and invest in our future, and our present.
Richard R. Buery Jr. is CEO of the Robin Hood Foundation, a former deputy mayor of New York City and a longtime leader in education and public service.