BOISE, ID – The Idaho Legislature widely — in less than two weeks — passed a bill that proposes sweeping policy changes to control Medicaid costs.

House Bill 345 calls for Idaho to seek work requirements for able-bodied Idahoans on Medicaid, and to give Idahoans eligible for Medicaid expansion access to tax credits to buy insurance on Idaho’s health care exchange.

The bill’s proposal for Medicaid work requirements — which requires federal approval to implement — has drawn the bulk of opposition.

In both chambers of the Idaho Legislature, the bill passed on party-line votes, with all 90 Republican state lawmakers supporting it and all 15 Democratic state lawmakers opposing it.

The Idaho Senate passed the bill on a 29-6 vote Tuesday, with all Senate Republicans backing it and all six Senate Democrats opposing it.

The new bill had unanimous support from House Republicans when the Idaho House passed it last week, and unanimous opposition from all nine House Democrats.

Less than two weeks ago, the Medicaid cost bill was first introduced in an Idaho House committee. The bill is a revised version of another Medicaid cost bill introduced days earlier.

The new bills came after Senate Health and Welfare Committee Chairwoman Julie VanOrden, R-Pingree, stopped another bill from advancing, which would’ve likely repealed Medicaid expansion.

The new bill would also call for Idaho to plan to shift management of all Medicaid benefits to private companies, which is called managed care and is used by most states’ Medicaid programs.

The Idaho Legislature has a Medicaid Review Panel to review contracts, VanOrden told the Idaho Senate on Tuesday.

“There is a lot to do. There’s a lot (of) people to be involved. And I assure you, there will be a lot of eyes on these,” said VanOrden, who is cosponsoring the bill along with Rep. Jordan Redman, R-Coeur d’Alene, House Health and Welfare Committee Chairman John Vander Woude, R-Nampa, and Sen. Carl Bjerke, R-Coeur d’Alene.

When the new Medicaid cost bill is transmitted to Gov. Brad Little, he has five days, excluding Sundays, to decide on it. He has three options: sign it into law, allow it to become law without his signature, or veto it.

If passed into law, the bill would take effect immediately through an emergency clause.

The bill could save Idaho $15.9 million in fiscal year 2026 and even more in the future, the bill’s fiscal note estimates. But the timing depends on federal approval, the fiscal note says.

Bill proposes broader Medicaid changes

Beyond Medicaid expansion, the bill proposes broader policy changes for the entire Medicaid program — a health care assistance program that covers about 262,000 Idahoans, including low-income earners, people with disabilities, pregnant women, and some older people.

Almost 89,400 Idahoans are enrolled in Medicaid expansion, a voter-approved policy that raised the income eligibility cap.

In the Senate Health and Welfare Committee hearing Monday, several members of the public said they worried about the bill’s provision to repeal agency administrative rules for Medicaid.

In that hearing, Idaho Department of Health and Welfare Deputy Director Juliet Charron, who oversees Idaho Medicaid, said the agency plans to stand up temporary rules if the bill passes.

Senate Minority Leader Melissa Wintrow, D-Boise, said she believed the bill will actually increase costs — and she noted how quickly the bill sailed through the Legislature.

“There’s so many moving parts to it. Had one week for stakeholders to get their input. And it was really unsettling for a lot of folks, especially the disability community. Because in the bill, we actually repeal two sections of rules in their entirety that were created and finalized in 2022 by the disability community to ensure that the services that they get are maintained. And this bill repeals it,” Wintrow said.

Bill estimates millions in savings. But critics say Medicaid work requirements will be expensive. 

Other states’ experiences and a federal watchdog report suggest costs for Medicaid work requirements are high, the Idaho Capital Sun previously reported.

Some advocates say Medicaid work requirements are costly and are effectively just administrative barriers to access the program — since almost half of Idahoans on Medicaid are already working. And many other Idahoans on Medicaid, advocates say, would be exempt from work requirements under exceptions the bill spells out, such as for parents of children age 6 and under, people with disabilities, college students, volunteers and caretakers.

Under the Trump administration, the federal Centers for Medicare and Medicaid Services approved work requirements in 13 states — for the first time in Medicaid’s history, according to KFF. The Biden administration rescinded the approvals. Several courts struck down states’ work requirement policies, according to the Center for Budget and Policy Priorities.

Idaho hasn’t gotten federal approval for work requirements, exchange tax credit option

Many of the bill’s proposals require federal approval, and would likely take years to implement.

In 2019, Idaho failed to receive federal approval — then by the Trump administration — for Medicaid work requirements and an exchange tax credit option, which are similar to the new bill’s provisions.

If the federal government cuts down on covering 90% of Medicaid expansion costs while the Idaho Legislature isn’t in session, the new Medicaid cost bill would give the Idaho Department of Health and Welfare director broad power to enact cuts to the program — until the Legislature reconvenes.

Congressional House Republicans recently approved a budget plan that calls for steep spending cuts that policy experts anticipate will require deep cuts to Medicaid.

This story first appeared on Idaho Capital Sun.