House Appropriations Committee hears briefing on FMAP and Medicaid funding risks for Vermont

Noel Langwell, Joint Fiscal Office, told the House Appropriations Committee on Feb. 28, 2025, that Federal Medical Assistance Percentage (FMAP) changes and related federal policy shifts could cost Vermont tens of millions of dollars and would affect hospitals, providers and state Medicaid programs.

The briefing explained FMAP mechanics and current Vermont figures, outlined how enhanced matching for Affordable Care Act expansion populations (the “childless new adult” group) and DSH (disproportionate share hospital) payments operate, and presented back-of-envelope scenarios for federal actions that would raise state general-fund costs.

Langwell said FMAP is the federal share of Medicaid financing and that Vermont’s fiscal 2024 total state appropriation was about $8.69 billion, with roughly $2.3 billion for Medicaid. ‘‘So 36% of our state budget are federal dollars,’’ he said, ‘‘and most of that is FMAP.’’ He described the standard match as roughly 58.8% federal / 41.2% state for Vermont’s base Medicaid services and said that, averaged across all programs in fiscal 2024, federal participation accounted for about 62% of Medicaid spending.

Why it matters: Medicaid is a large share of the state budget, and changes to matching rates or related federal rules would require either additional general-fund support or cuts to services or provider payments. Langwell and committee members flagged hospitals, the childless-adult…