What Medicaid Cuts Mean for Ohio's Doctors and Patients

By Solomon Jumu

B.S. in Neuroscience, The Ohio State University

Medical School Applicant

Medicaid is a health insurance program that provides free or low-cost coverage to millions of Americans, including low-income families, children, seniors, and people with disabilities. The federal government and states jointly fund the program, so each state runs its own version of Medicaid. The Health Policy Institute of Ohio says that Medicaid provides healthcare coverage for nearly 3 million Ohioans and had a budget of over $43 billion in 2025. That funding is now shrinking.

A hospital care setting illustrating the role of Medicaid in supporting access to healthcare.

In July 2025, Congress passed H.R. 1, known as the "One Big Beautiful Bill," which made the largest Medicaid cuts in the program's history. States fund their portion of Medicaid through taxes. One of these is the provider tax, which taxes hospitals, insurance companies, and other healthcare companies to raise money for the state’s share of Medicaid funding; the federal government then matches that money with additional dollars.

The new H.R. 1 law strictly limits provider taxes and gradually lowers how high they can go, while also capping the bonus payments states use to boost what doctors and hospitals earn for treating Medicaid patients. These limits create a domino effect. When Ohio collects less provider tax revenue, there is less state money for the federal government to match. According to the Health Policy Institute of Ohio (HPIO), H.R. 1 is expected to cut roughly $33 billion in federal funding from Ohio's Medicaid program over the next decade. When billions are erased from a state’s budget, lawmakers are forced to make major cuts, such as lower reimbursement rates, fewer covered services, and health insurance for fewer Ohioans. Doctors and hospitals feel these cuts first.

Medicaid already pays providers less than Medicare or private insurance. When funding shrinks, states often respond by cutting reimbursement rates even further. HPIO estimates that Ohio providers will lose about $200 million per year from the payment restrictions alone. For hospitals that serve lots of Medicaid patients, that can mean cutting staff, dropping services, or closing altogether. Some doctors may stop accepting Medicaid patients because the payments don't cover their costs. All of this trickles down to patients.

Doctor consulting with patient. Courtesy of the National Cancer Institute.

H.R. 1’s stricter eligibility rules mean fewer Ohioans will qualify for Medicaid, and those who lose coverage lose access to care. For those who stay covered, cuts in the Medicaid budget lead to fewer covered healthcare services. Medicaid cuts also result in fewer doctors who accept Medicaid insurance, which leads to longer waiting times and farther drives for care.

Ultimately, the ones who pay the price for these budget cuts are everyday Ohioans. Still, there is hope. Ohio has options to soften the blow of the H.R. 1 bill. According to HPIO, Ohio can save one of its biggest funding sources, the tax on health insurance companies, by charging all health insurers the same rate instead of taxing Medicaid plans at a higher rate. This change would comply with new federal laws and preserve billions in state and federal funding for Medicaid. Ohio can’t undo the law, but smart decisions can protect the care millions of Ohioans depend on.

Sources

• Health Policy Institute of Ohio, "Changes to Medicaid Financing in Ohio" (March 2026)

• American Medical Association (AMA), “Changes to Medicaid, the ACA and Other Key Provisions of the One Big Beautiful Bill Act,” American Medical Association, updated August 5, 2026. AMA article