SR116

THE SENATE	S.R. NO.	116
THIRTY-THIRD LEGISLATURE, 2025
STATE OF HAWAII

SENATE RESOLUTION

urging the governor to determine a course of action for the state, should the federal government cut funding for medicaid.

WHEREAS, Medicaid provides comprehensive health and long-term care to more than seventy-two million Americans with limited income and resources who meet eligibility requirements, including children, adults, seniors, and people with disabilities; and

WHEREAS, Hawaii's state Medicaid program, Med-QUEST, provides health care coverage to approximately one in five Hawaii residents and one in three children and serves as a cornerstone of Hawaii's health care infrastructure and a lifeline for vulnerable population; and

WHEREAS, in fiscal year 2023, the total Medicaid spending in Hawaii was $3,000,000,000, of which seventy-three percent was paid by the federal government, which highlights the impact federal funding has on Medicaid services in the State; and

WHEREAS, Federally Qualified Health Centers (FQHCs) are federally funded entities that meet certain requirements, including providing care to patients regardless of the ability to pay; and

WHEREAS, Hawaii's FQHCs provide critical health care services at over one hundred sites; in 2023 they served 158,448 patients, including over forty-five thousand children, twenty-five thousand kupuna, 7,520 individuals experiencing homelessness, 3,568 veterans, and 1,744 agricultural workers, which demonstrates the wide-ranging impact and reach FQHCs have amongst the most vulnerable groups in the State; and

WHEREAS, Hawaii's FQHCs predominately serve low-income populations, with over fifty percent of patients seen at FQHCs living below the federal poverty level and fifty-seven percent insured through Medicaid, which highlights Medicaid's indispensable role in enabling care for Hawaii's underserved communities; and

WHEREAS, Hawaii's FQHCs provide high-quality, cost-effective care that reduces overall health expenditures in the State; for example, in 2023, medical expenditures were reduced by twenty-four percent for Hawaii Medicaid patients who received services at an FQHC compared to Medicaid patients who received care via other providers, which generated about $215,800,000 in savings to Medicaid and $301,000,000 in savings to the overall health system; and

WHEREAS, Hawaii's FQHCs also stimulate the State's economy; for example, in 2023, FQHCs employed two thousand ten staff directly and supported 3,594 total jobs, which generated over $23,100,000 for state and local tax revenues and had a total economic impact of over $580,300,000; and

WHEREAS, in February 2025, a budget resolution was passed by the United States House of Representatives that approved a drastic reduction for Medicaid funding of more than $800,000,000,000 over the next ten years and elimination of the federal Patient Protection and Affordable Care Act (ACA) expansion match rate, which would drastically curtail federal support for Hawaii's health care programs and the Medicaid-enrolled population; and

WHEREAS, a study by the Kaiser Family Foundation, a nonpartisan organization that researches and reports on health policy in the United States, examined the impact of eliminating the ACA Medicaid expansion, wherein the federal government pays ninety percent of the costs for Medicaid expansion enrollees, under two scenarios:

(1) Assuming that all expansion states maintain Medicaid expansion coverage and pick up new expansion costs, federal Medicaid spending would decrease by ten percent (or $626,000,000,000) and state Medicaid spending would increase by seventeen percent (or $626,000,000,000) over a 10-year period; and

(2) Assuming that all states drop the ACA Medicaid expansion coverage in response to the elimination of the ninety percent federal match rate, federal Medicaid spending would decrease by twenty-five percent(or $1,700,000,000,000), and state Medicaid spending would decrease by five percent (or $186,000,000,000) over a ten-year period; and

WHEREAS, under the second scenario, total Medicaid spending would be cut by nearly one-fifth (or $1,900,000,000,000), and nearly a quarter of all Medicaid enrollees, twenty million people nationally, would lose coverage; and

WHEREAS, only states that have adopted the Medicaid expansion would see any spending or enrollment impacts under this policy proposals, though changes would vary by state; and

WHEREAS, according to the study, if Hawaii picked up the new expansion costs under scenario 1, the anticipated loss of federal funding per fiscal year that would need to be offset by State funds is $3,200,000,000; and

WHEREAS, under scenario 2, in which Hawaii would drop Medicaid expansion coverage, federal Medicaid funding would decrease by $9,400,000,000 while state Medicaid funding would decrease by $1,000,000,000 annually and result in one hundred fifty-six thousand people, or thirty-four percent of Hawaii's total Medicaid population, losing coverage; and

WHEREAS, if Hawaii maintains Medicaid expansion coverage in the wake of this policy change, lawmakers will need to increase the general fund appropriation to HMS401 on a continual basis or find new sources of funding for this vital program; and

WHEREAS, such severe cuts to Medicaid would have dire consequences for the State and FQHCs, such as reducing health coverage for Medicaid patients, increasing the number of uninsured individuals, decreasing access to care, and reversing positive health outcomes associated with Medicaid expansion; and

WHEREAS, the federal government has also initiated massive reductions in the federal workforce that will increase the number of uninsured workers and their families in the State, which will have a significant impact on Hawaii's Medicaid program; now, therefore,

BE IT RESOLVED by the Senate of the Thirty-third Legislature of the State of Hawaii, Regular Session of 2025, that the Governor is urged to determine a course of action for the State, should the federal government cut funding for Medicaid; and

BE IT FURTHER RESOLVED that the Governor is urged to consult with the members of Hawaii's congressional delegation to ascertain the impacts of pending federal legislation on Medicaid expansion and the timing of any reduction in federal funding; and

BE IT FURTHER RESOLVED that the Governor is requested to submit a report of any findings and recommendations, including proposed legislation, to the Legislature no later than twenty days prior to the convening of the Regular Session of 2026; and

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to each respective member of Hawaii's congressional delegation, the Governor, Director of Commerce and Consumer Affairs, Director of Health, Director of Human Services, and Director of Finance.

	OFFERED BY:	_____________________________

Report Title:

Medicaid; Medicaid Expansion; Federal Funding; Budget Cuts

SR 116: URGING THE GOVERNOR TO DETERMINE A COURSE OF ACTION FOR THE STATE, SHOULD THE FEDERAL GOVERNMENT CUT FUNDING FOR MEDICAID.

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