Federal reconciliation bill HR1 and new CMS rules may cut coverage and federal payments to Washington Medicaid, officials say

Olympia — State health officials told the Senate Health and Long Term Care Committee on July 22 that the federal reconciliation bill known as HR1, together with several new Centers for Medicare & Medicaid Services rules, will likely reduce health coverage and federal funding in Washington and create new administrative burdens for Medicaid recipients and providers.

The Washington governor’s senior health policy advisor, Caitlin Stafford, told the panel the state expects “coverage losses pretty immediately” in the individual market and warned of cascading effects for Medicaid and providers. Stafford said, “we're probably gonna start seeing at a minimum about 80,000 people not being able to afford coverage starting in January.”

Stafford and officials from the Washington State Health Care Authority (HCA) described overlapping changes: HR1’s provisions on work requirements, more frequent eligibility checks, limits on state-directed payments to providers, and new cost-sharing plus several CMS rules finalized in 2023–2024 covering prior authorization, managed-care oversight, home-and-community-based services (HCBS), and eligibility/enrollment automation.

Why it matters: Committee members were told the combined effect could lower enrollment, reduce payment tools that support safety-net hospitals and other providers, and raise administrative burdens on beneficiaries — at a time when state leaders expect substantial budget pressure.

What officials told the committee - Caitlin Stafford, Senior Health Policy Advisor to Governor Jay Inslee, said premium increases and the possible expiration of enhanced advance premium tax credits will produce immediate losses in the individual market and that the state must plan for…