Providers, advocates tell Assembly panel proposed federal Medicaid cuts would threaten New Jersey care and services

Chairwoman Murphy convened a listening hearing of the Assembly Health Committee in Trenton to gather testimony about possible federal cuts to Medicaid and Medicare and their likely effects on New Jersey residents and health providers. Witnesses from hospitals, home‑health agencies, disability providers, child welfare and workforce groups described widespread risks to access, programs and jobs if federal funding is reduced.

The committee was told that New Jersey now enrolls about 1,800,000 people in New Jersey Family Care and that hundreds of thousands could face coverage loss or strained services if federal matching funds or expansion funding change. Assembly Health Committee Chairwoman Murphy opened the session by calling it “a listening hearing for us, and our job today is to listen and to gather the facts that we need to know about how those cuts may or may not impact our families, our providers, our health care access.”

Why it matters: Testimony emphasized that Medicaid underpins a wide array of services beyond doctor visits — from nursing‑home stays and home‑and‑community supports to school‑based therapies and specialized pediatric care. Several witnesses supplied enrollment and fiscal estimates to show the scale of potential loss: 568,000 New Jersey residents were cited as enrolled through the ACA Medicaid expansion and officials warned that lowering the federal match for that population could cost the state “up to $8,000,000,000” to maintain current eligibility limits (testimony from Abby Lewis, United for ALICE, and others). Advocates said an estimated 700,000 people could be put at risk by some proposed eligibility or administrative changes.

Most urgent claims and evidence

- Hospitals and pediatric systems: Diana Montoya Williams, a neonatologist with Children’s Hospital of Philadelphia, said Medicaid “allows [pediatric] systems to simply, stay alive,” noting CHOP cared for more than 34,000 New Jersey children insured by Medicaid and that deep cuts could threaten hospital capacity and specialized pediatric units. She warned that reduced funding would not reduce demand for emergency or specialty care and could force closures or service reductions.

- Long‑term care and home health: Jim McCracken of LeadingAge New Jersey and representatives from visiting‑nurse and home‑health agencies said Medicaid funds a large share of long‑term services. They told the committee these programs already operate on thin margins and that cuts would worsen workforce shortages, exacerbate nursing‑home financial shortfalls and risk service closures.

- Behavioral health and addiction treatment: Pyramid Healthcare and community mental‑health providers said Medicaid is the largest payer for behavioral‑health services and that cuts would reduce treatment availability, increase emergency‑room use and harm recovery programs. Pyramid pointed to a facility in Hamilton with roughly 200 beds that serves thousands annually and said program closures would have local economic effects as well as clinical consequences.

- Schools and special education: John Mahalon of ASSA argued that New Jersey’s Special Education Medicaid Initiative (SEMI) reimburses districts for medically necessary school services — speech, occupational therapy, nursing and counseling — and warned cuts would “trickle down” to schools, possibly reducing therapy hours or support staff and increasing disputes over individual education programs required under the Individuals with Disabilities Education Act.

- Disability services and HCBS: Providers for people with intellectual and developmental disabilities — including Bancroft, The Arc of Monmouth and Disability Rights New Jersey — told the committee that the state’s home‑and‑community‑based services depend on Medicaid funding and that “optional” federal changes or lower reimbursements would leave programs vulnerable, with longer waiting lists, lower direct‑support wages and pressure toward more institutional care. Bancroft said Medicaid accounts for roughly 70% of its revenue and that even small funding losses could force group‑home closures and staff cuts.

- Economic and workforce impacts: Business groups and workforce advocates said the health‑care sector accounts for a large share of state GDP and employment and that Medicaid cuts would ripple through local economies, reducing jobs in hospitals, nursing homes, home care and community providers. SEIU 1199 emphasized the risk to direct care workers and called for coordinated action to protect jobs.

What witnesses recommended

Witnesses asked the committee to: (1) press New Jersey’s congressional delegation to oppose federal cuts; (2) coordinate with state departments to estimate local fiscal impacts; (3) protect or restore state appropriations where the governor’s budget proposed reductions to specialized programs; and (4) consider contingency plans to preserve core services such as home‑and‑community‑based supports, pediatric specialty care and school‑based therapies.

Direct quotes from the hearing included a range of firsthand examples. Alan Murray, CEO of Medidrive, said, “Access to health care is a fundamental right, and transportation plays a vital role in ensuring that our most vulnerable population can receive the medical care they need.” Diana Montoya Williams of CHOP warned that Medicaid reimbursement helps pediatric systems “stay alive,” and multiple disability advocates said the program is the difference between independent living and institutionalization.

No vote or formal action was taken; the hearing was described by the chair as an information‑gathering session to inform further legislative and administrative responses. The committee indicated it will continue briefings and seek follow‑up data from state agencies and providers.

Ending note: Witnesses repeatedly urged the Assembly to coordinate with the state’s federal delegation and to earmark state resources where possible to mitigate immediate program disruptions, while many speakers signaled they will continue to provide data and written testimony to the committee.