Which states have trigger laws to automatically end Medicaid expansion if federal funding drops?

What are Medicaid trigger laws?

Several states – listed below – have laws in place that will automatically terminate Medicaid expansion in these states if the federal matching percentage is reduced.

This means enrollees with Medicaid expansion coverage would lose their coverage soon after a reduction in federal funding.⁶

There are variations in terms of the specific state rules. For example, the trigger law in Illinois calls for Medicaid expansion eligibility to end “no later than the end of the third month following” the month the federal funding reduction takes effect.⁷ And in Arkansas, the trigger law calls for the state to transition enrollees out of the Medicaid expansion program within 120 days of the federal funding reduction.⁸

But in Arizona, the state’s trigger law simply says that the state “shall discontinue eligibility” under Medicaid expansion if federal funding drops below 80%, without a set waiting period before that takes effect. (Arizona’s trigger law has an 80% threshold rather than 90%.)⁹ And in Utah, the trigger law would end Medicaid expansion “no later than the next July 1” after the date the federal funding is reduced.¹⁰ Depending on the timing of a federal funding cut, that could be an almost immediate termination of Medicaid expansion, or there could be a delay of up to almost a year.

If a trigger law is activated and Medicaid expansion ends, access to coverage in the state would then work the way it does in the states that haven’t expanded Medicaid. There would be a coverage gap for most adults with income below the federal poverty level, and Marketplace subsidy eligibility would begin at household incomes equal to the federal poverty level (FPL). While Medicaid expansion is in place, Marketplace subsidy eligibility begins with household incomes above 138% of FPL because residents in expansion states are eligible for Medicaid if they have a household income up to 138% of FPL.

Which states have trigger laws?

The states with trigger laws are:⁶

• Arizona (Expansion would end if the federal match drops below 80%.)⁹
• Arkansas
• Illinois (Legislation introduced in 2025 would remove the trigger law.)¹¹
• Indiana
• Montana
• New Hampshire
• North Carolina (Legislation introduced in 2025¹² would change the trigger law so that it would only be activated if the federal matching rate for the expansion population were to drop below the federal matching rate for the rest of the Medicaid population, which is currently about 65% in North Carolina.¹³)
• Utah
• Virginia (A 2025 Virginia budget amendment that would have developed “recommendations to preserve health care access to as many Medicaid members as possible”¹⁴ was not included in the state's budget, but if federal funding for Medicaid expansion is reduced, Virginia’s Legislature can reconvene for a special session.)¹⁵

Another three states – Iowa, Idaho, and New Mexico – have rules in place that would trigger a review of Medicaid expansion if the federal match rate were to drop below 90%. So while these states do have trigger laws, the trigger is for a review of the program rather than an automatic termination. But that review could result in benefit cuts or the elimination of Medicaid expansion.⁶

How many people would lose Medicaid coverage due to trigger laws?

More than 3 million people would lose their health coverage if the federal matching rate were to be reduced and the state trigger laws were to be activated. That number would increase to almost 3.7 million if Medicaid expansion were to also be eliminated in Iowa, Idaho, and New Mexico.⁶

How would states without trigger laws be affected if federal Medicaid funding is reduced?

It would likely be difficult for any Medicaid expansion state to pick up the slack if federal Medicaid funding for the expansion population is reduced. If that happens, expansion states without trigger laws might enact legislation to change or eliminate their Medicaid expansion programs.

South Dakota’s legislature enacted a joint resolution in March 2025  that calls for a measure to be placed on the state ballot allowing voters to decide whether Medicaid expansion in the state should continue if federal funding drops below 90%.¹⁶

Lawmakers in West Virginia and Idaho are considering legislation in 2025 that would create trigger laws in those states. The legislation in West Virginia was introduced in late March and was under consideration by the state House in early April.¹⁷ The legislation in Idaho passed in the state House in February and was sent to the Senate for consideration.¹⁸