News from the Capitol

The Legislative Insider is published during the Legislative Session by the Georgia Dental Association. It contains updates on the activities of GDA's Government Affairs team as well as information about bills relevant to dentists and patient care.

Understanding the Impact of Federal Budget Reconciliation on Georgia Medicaid

Mar 10, 2025
Proposed Medicaid cuts could raise Georgia’s costs, possibly affecting dental benefits and provider pay.

A recent budget resolution framework proposed in congress raises the specter of changes to Medicaid. The framework, part of a process known as budget reconciliation, places the responsibility for $880 billion worth of spending cuts into the hands of members of the House Energy and Commerce Committee. Cuts to Medicaid could potentially impact Georgia dentists, but whether they do depends on the specifics of federal policy and the decisions of stakeholders in Georgia.  


What might happen to Medicaid? 

Specifics about spending cuts related to Medicaid have not been announced. The House Energy and Commerce Committee is looking at several options that would reduce federal spending. The first of the 2 most discussed options is equalizing the Federal Medical Assistance Percentage (FMAP) for Affordable Care Act (ACA) expansion populations with that of traditional Medicaid. Currently, federal dollars cover 90% of the cost of covering expansion populations. Equalizing FMAPs would mean the federal government would pay less to expansion states. KFF estimates that a change like this could result in federal savings of $626 billion over a decade. Costs could shift to the states, but some states would potentially choose to drop the expansion altogether in response.  

Another major proposal is to implement a per capita cap on Medicaid spending. Instead of matching states’ spending at a rate determined by a formula, the federal government would pay a set price per beneficiary: the current proposal suggests the cap would grow at the rate of medical inflation. Federal savings generated by a cap would be dependent on state response. KFF estimates savings to be between $532 billion and $989 billion depending on whether states simply assume the costs or choose to reduce spending and eligibility where able.  

Notably, Georgia is not an expansion state, and reducing the FMAP for expansion populations would not reduce the funds Georgia receives from the federal government for Medicaid. A per capita cap would affect Georgia, and it could potentially raise the states’ spending on Medicaid by as much as 13% if policy makers choose to maintain current levels of spending and eligibility. 


How does this impact Georgia dentists and their patients? 

The impact on Georgia dentists and their patients would be the result of the state’s response to the policy change. A per capita cap would present policymakers with a choice, and that choice would result in downstream effects. Choosing to maintain everything as is would require the state to raise additional revenue or offset costs in some other way. Alternatively, the state could choose not to maintain eligibility or benefits. States could attempt to reign in per enrollee spending cutting optional benefits, adjusting provider payment rates, and tinkering with other program elements. 

One of the big headlines of 2024 was that Georgia lawmakers added a comprehensive adult dental benefit to Medicaid. This is the kind of optional program that could be cut in response to drastic reductions in federal Medicaid reimbursement. Another big focal point is provider reimbursement. Historically, dental provider reimbursement has lagged behind inflation, and Georgia is neither a leader in provider reimbursement in the United States nor amongst its neighboring states. There is very little room to reduce spending in this area, but policy makers could choose not to increase reimbursement for providers as well. This is a particularly important factor to consider because provider reimbursement is positively correlated with access to care.  

Another third potential impact is that the committee selects other policy changes or that the cuts come from somewhere else. Medicaid is one potential area for cuts, but the committee has looked at some energy policy adjustments as well. Some proposals, such as the focus on expansion populations described above, would have minimal impact on Georgia. Other proposals would affect Georgia, but they would be felt in different areas of the healthcare sector. For example, making payments from Medicare site neutral could save more than $100 billion over ten years, but this change in reimbursement would be felt in hospitals.  


What can I do? 

Right now, nothing is guaranteed, but dentists can always participate in ongoing advocacy that helps legislators stay informed about policy decisions that affect the dental profession. Informed legislators have better decision-making tools at their disposal, and this gives them the opportunity to make smarter decisions about policy. The first step in any advocacy project is to make sure the voice of the dental community is heard.  

Normally, the last paragraph in these blog posts encourage members to get involved with GDA’s ongoing legislative advocacy. To get more involved in advocating for dentistry in the state of Georgia, consider attending LAW Day, signing up as a contact dentist, or donating to GDAPAC. But conversations about federal and state policy interaction go beyond advocacy in Georgia. Fortunately, the tripartite includes the legislative advocacy team at the American Dental Association (ADA). To get more involved in advocacy at the federal level check out the ADA’s Legislative Action Center page today.