In 2024, the Texas State Guard participated in Operation Border Health, a five-day free health clinic in Texas. The annual event was canceled this year after the Trump administration announced a plan to strip more than $550 million in federal public health and pandemic emergency funds from Texas. (Texas State Guard/CC BY-ND 2.0)
Patients begin lining up before dawn at Operation Border Health, an annual five-day health clinic in Texas’ Rio Grande Valley. Many residents in this predominantly Latino and Hispanic region spanning the Mexican border lack insurance, making the health fair a major source of free medical care in South Texas for more than 25 years.
Until this year. The Trump administration’s plan to strip more than $550 million in federal public health and pandemic funds from Texas helped prompt cancellation of the event just before its scheduled July 21 start.
“Some people come every year and rely on it,” said Hidalgo County Health and Human Services Director Dairen Sarmiento Rangel. “Some people even camp out outside of Border Health so they can be the first in line to receive services. This event is very important to our community.”
States and local governments have made painful program cuts in the wake of major reductions in federal health funding that have already taken effect. Now, they’re sizing up the financial hits to come — some not until late next year or beyond — from the “One Big Beautiful Bill Act,” the tax and spending law congressional Republicans passed in July that enacts much of President Donald Trump’s domestic agenda.
Texas, for instance, expects to see its federal Medicaid funds reduced by as much as $39 billion over 10 years due to new barriers for enrollment, such as more frequent eligibility checks, according to a July analysis by KFF.
Taken together, the reductions amount to a seismic shift in how state health programs are provided and paid for. The administration is, in effect, pushing a significant amount of health costs to states. That will force their leaders to make difficult choices, as many state budgets are already strained by declining tax revenues, a slowdown in federal pandemic spending, and economic uncertainty.
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Revenue forecasters in more than a dozen states have lowered expectations for the coming year, according to a June report by Pew.
“It’s almost inevitable that states will enact a number of cuts to health services because of the fiscal pressure,” said Wesley Tharpe, senior adviser for state tax policy at the left-leaning Center on Budget and Policy Priorities.
Some are proactively trying to stanch the impact.
Hawaii lawmakers are looking to aid nonprofits that are already contending with federal funding cuts. They’re doling out $50 million in grants to health, social service, and other nonprofits hit by federal funding cuts. To get the money, nonprofits must show a termination or drop in funding, or that they have otherwise been harmed by the cuts.
“It is not fair that organizations dedicated to supporting the people of Hawaii are being forced to scale back due to federal funding cuts,” Democratic Gov. Josh Green said in a statement.
Other states are scaling back projects to contend with cuts. Delaware Gov. Matt Meyer, a Democrat, received notice in March that the Trump administration was cutting $38 million in public health funding from the state. The next month, state legislative leaders halted a planned project to upgrade and expand the Capitol complex as a result.
“We recognized that the reckless federal cuts to the social safety nets of thousands of Delawareans called for us to hold back resources to protect our most vulnerable,” said David Sokola, president pro tempore of the Delaware Senate.
In New Mexico, the state with the highest percentage of residents enrolled in Medicaid, a bipartisan group of lawmakers voted to create a trust fund to boost funding for the program. About 10% of the more than 800,000 state residents covered by Medicaid and the related Children’s Health Insurance Program could lose their health coverage under the federal spending law, based on some estimates.
Some state leaders are warning constituents that the worst may be yet to come.
At an Aug. 18 event at a hospital in the South Bronx section of New York City, New York Gov. Kathy Hochul, a Democrat, stood on stage among health care workers in white coats to skewer Trump’s new law.
“What Republicans in Washington have done through the ‘Big Ugliest Bill’ I’ve ever seen is literally screwing New Yorkers,” she said. The state’s health system is bracing for nearly $13 billion in annual cuts.
And in California, lawmaker …