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County officials warn federal shutdown, HR 1 could cut health funding and disrupt services
Summary
County advisers told the Health and Hospital Committee that a continuing federal government shutdown and House bill HR 1 threaten large cuts to Medicaid-related funding and other programs, and staff outlined local consequences including possible CalFresh payment interruptions and pressure on county health services.
County officials told the Santa Clara County Health and Hospital Committee on Oct. 13 that a continuing federal government shutdown and provisions in House Resolution 1 (HR 1) pose immediate and substantial fiscal risks to county health programs.
Bert Margolin of the Margolin Group told the committee that two central Democratic budget priorities are a repeal of large Medicaid cuts in HR 1 and an extension of enhanced Affordable Care Act premium tax credits. "The first has been a repeal of the $1,000,000,000,000 Medicaid cut, which could produce as many as 50,000,000 people losing their health coverage," Margolin said. He added that the premium tax credits, if allowed to expire at the end of the year, would cause "on average, a 100% increase" in premiums for the 24,000,000 Americans on the exchanges.
The committee heard from county staff that the shutdown is already affecting local operations: grant portals and approvals are delayed, and county social‑services payments such as CalFresh could be disrupted if the shutdown continues past Nov. 1. "The next major impact that we would anticipate seeing is to the CalFresh program if the shutdown continues past November 1," county staff said during the discussion.
Committee members pressed staff on contingency planning. County executive staff and department directors described work with state and federal partners to identify short‑term backfill options and the need for statewide coordination on beneficiary notifications. "It does sound like... the state may choose to do the beneficiary notifications themselves to make sure it's uniform across counties," a county official said.
Members discussed political dynamics in Washington that have complicated negotiations. Margolin described both parties as "dug in" and said some senators were exploring a short‑term, one‑year extension of tax credits as a compromise — a solution Democratic leadership dislikes because it still creates market instability.
Why it matters: committee members emphasized the potential operational and human impacts should federal funding lapse. The county is tracking possible interruptions to benefit payments, delays to approvals tied to health and social services, and the larger risk that hospital and provider networks could be strained if funding cuts are realized.
What the committee did: after the presentation and discussion, the committee received the federal and state health policy and budget landscape report by voice vote (two ayes, motion carried).
