The scale of federal retrenchment is no longer theoretical. In Massachusetts alone, the state is bracing for an estimated $3.5 billion annual loss in federal Medicaid funding once H.R. 1 is fully implemented, against a total Medicaid budget of over $20 billion. Even with aggressive mitigation, the state could still see about 300,000 residents lose coverage.

The idea that H.R. 1 simply “right-sizes” Medicaid while protecting the most vulnerable is already breaking down. Children, pregnant women, and people with disabilities are already feeling the effects through fear-driven disenrollment, mounting pressure on rural maternity care, and tighter scrutiny of home- and community-based services.

States cannot replace lost federal dollars, but they are not standing still. This episode of The 80 Million Podcast shows how state leaders are investing in trusted, community-based outreach to keep eligible people covered, tackling affordability, shoring up providers and leading through the maelstrom.

The evidence that addressing social needs like food and transportation improves health outcomes and reduces Medicaid costs is no longer theoretical. We’ve seen recent data from two efforts: North Carolina’s Healthy Opportunities Pilots (HOP) generated $164 in savings per member per month, according to a new, multiyear evaluation of 31,000 Medicaid enrollees by the Sheps Center at University of North Carolina. The Centers for Medicare & Medicaid Services (CMS) Accountable Health Communities model showed 3%–4% reductions in total cost of care through screening and navigation alone.

Payment remains a major structural barrier. Most of this work — outreach, navigation and coordination — has no billing code under fee for service. Scaling requires value-based arrangements with real teeth, not the “value veneers” that occupy value-based care real estate without changing care delivery. Waymark, a Medicaid-focused care delivery company, addresses this by pairing AI-enabled community-based care teams with value-based contracts designed to measure impact and align payment with proven intervention.

States don’t need to wait for federal action. Managed Medicaid contracts allowing for accountable programs that meet social and clinical needs, using in-lieu-of services authority, and directing rural health transformation dollars toward this infrastructure are all available now. Still, permanent scale will require Congress to move this work from waiver territory into the core Medicaid benefit.

Rajaie Batniji, Patti Boozang and Mandy Cohen explore what the latest evidence on addressing social needs in Medicaid means for policy and practice in this week’s 80 Million Podcast. The discussion examines why the case for action is stronger than ever, what it takes to scale these interventions, and where states can move now.

State Medicaid programs are under extraordinary pressure as they navigate federal funding uncertainty, H.R. 1 implementation, and health care cost growth that consistently outpaces both inflation and state revenue growth. States have myriad technology vendors pitching solutions to help alleviate those burdens, particularly around helping drive down the costs associated with certain clinical conditions and administrative functions. These technology solutions, increasingly, are AI powered and promise to be the differentiator for patients and Medicaid budgets alike.

It can be daunting for state Medicaid leaders to evaluate which technologies deliver, where there are risks, and the types of structural changes that are needed for innovation to benefit the people Medicaid serves rather than the vendors selling to it.

In Episode 3 of The 80 Million Podcast, host and 80 Million editor Patti Boozang speaks with Caroline Pearson, executive director of the Peterson Health Technology Institute (PHTI), and Jared Augenstein, senior managing director at Manatt Health, about what Medicaid leaders should believe — and question — about the explosion of artificial intelligence (AI) and digital health solutions entering the market.