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care economy
Medicaid Cuts Put Services for Vulnerable People at Grave Risk
Medicaid doesn’t just provide healthcare. It is the single largest payer for the community-based services people with intellectual and developmental disabilities need to live, work, and thrive in our communities.
May 22, 2025
With the House passing their budget reconciliation bill with a vote of 215-214, hundreds of billions in proposed cuts to Medicaid have moved one step closer toward very real, harmful consequences, including for people with intellectual and developmental disabilities, or I/DD, whose health, safety, and quality of life depend on Medicaid.
Medicaid doesn’t just provide healthcare. It is the single largest payer for the community-based services people with I/DD need to live, work, and thrive in our communities—services that range from assistance with intimate activities of daily living and personal hygiene, to employment supports to find and maintain a job, to providing residential and in-home supports to support independent living.
If lawmakers approve the proposed cuts to Medicaid, state budgets will be unable to absorb the financial shock. Even if targeted to other groups like those made eligible for services through Medicaid expansion, programs that enable people with I/DD to meaningfully participate and thrive in our society will be the first to go. We know because home- and community-based services for people with I/DD are optional services, meaning they are some of the last services to be funded when there’s a state funding shortfall. We saw this following the Great Recession when, following cuts to federal funding, every single state made cuts to services and 36 states specifically made cuts to services for people with I/DD.
If lawmakers truly care about boosting economies, they would invest in, not divest from Medicaid, because these services actually play a critical yet often invisible role in state economies.
Divesting from Medicaid will be devastating to providers of I/DD services who are already struggling immensely due to insufficient Medicaid reimbursement rates that haven’t kept pace with inflation. As a direct result, 90% of community providers report moderate to severe staffing shortages as workers seek out higher-paying jobs in entry-level retail, convenience, and fast food industries. Without sufficient staffing, 69% of community providers report they’re unable to take new referrals for people with I/DD who need and qualify for services.
Medicaid cuts by another name in the form of increased red tape eligibility requirements or work reporting requirements also threaten people with disabilities, who may lose coverage due to barriers completing onerous reporting requirements, even if they are provided an exemption. Such requirements also threaten to further exacerbate the direct support workforce crisis, as 49% of direct care workers rely on public assistance programs themselves, and approximately one-third work part-time or with inconsistent schedules—two job features that are generally incompatible with work reporting requirements. If direct support professionals, the very backbone of disability services, are unable to meet burdensome reporting requirements, it will only force them to find more stable, higher-paying jobs outside of care work.
If lawmakers truly care about boosting economies, they would invest in, not divest from Medicaid, because these services actually play a critical yet often invisible role in state economies.
New York State’s $6.7 billion investment in home- and community-based services generated $14.3 billion in economic activity, while Maine is estimated to have lost out on over $1 billion due to its shortage of direct care workers. That’s because Medicaid-funded services create jobs, while enabling the family members and caregivers of people with I/DD to remain in the workforce too. Without services, families are also more likely to need public assistance.
The House’s budget proposal will force unthinkable decisions on states and providers. It will undoubtedly lead to people with I/DD losing access to services, potentially being forced to languish in their homes without the assistance they need for using the restroom, supportive hygiene, and preparing and eating meals. It will lead to people with I/DD losing their jobs without the employment supports they need to maintain their careers. And it could mean unnecessary institutionalization of people whose right to live and thrive in their communities was codified by the Americans with Disabilities Act and, later, the Supreme Court’s decision in Olmstead v. L.C.
Senators hold the opportunity to continue protecting our most vulnerable populations by rejecting any cuts to Medicaid and not putting further stress on a system already in crisis.
Update: This piece has been edited to reflect the fact that the U.S. House of Representatives passed their budget reconciliation bill on the morning of May 22, 2025.
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We Know How Bad Trump's Tax Policy Is, But Just How Good Will Harris' Be?
Harris wants to invest in the care economy and has signaled support for raising corporate tax rates, while Trump has been largely silent on care investments and signaled support for more tax cuts at the top.
Aug 25, 2024
U.S. Vice President Kamala Harris and former President Donald Trump have starkly different views on taxes and how the tax code can support families.
Harris voices strong support for families through investments in the care economy. She’s vowed to advance paid family leave, affordable childcare, care for disabled or aging family members, and healthcare. This could be funded with a better tax code.
These policies would help all of us care for our families and strengthen our communities. Investing public dollars in care could also narrow racial and gender pay gaps by boosting the pay of care workers—who are mostly women, and many of them women of color.
Strengthening care infrastructure would help us all thrive and make the economy stronger. But we need to collect sufficient revenue to support those transformational policies.
The Trump campaign has been largely silent on care investments. But his campaign has signaled support for more tax cuts at the top. Such cuts would increase inequality and reduce the availability of federal funding to strengthen the care economy.
We saw this in the 2017 tax law that former President Trump signed. It cut taxes for the wealthiest people and corporations, including cutting the effective tax rate for our largest corporations from an average 22% to an average 12.8%. It also preserved loopholes that allow some of the wealthiest corporations to avoid taxes on most—if not all—of their profits.
These tax cuts for the ultra wealthy led to huge losses in federal tax revenue and spiked the national debt, making it harder for the government to fund new investments in priorities that are important to families.
If reelected, Trump has said he wants to slash corporate taxes further—even though some billionaires pay a lower share of their income in taxes than nurses and teachers do.
By contrast, the Biden-Harris administration created a minimum corporate tax so the wealthiest corporations could no longer pay nothing, added a modest tax on stock buybacks, and funded the IRS to better collect taxes from corporations. These policies raised revenue for care investments and other priorities.
Going forward, Harris has signaled support for raising corporate tax rates, which are at historic lows, and closing loopholes.
Harris and Trump also have different priorities on taxes for families. As a senator, Harris championed a tax credit of $6,000 for married couples and $3,000 for single people in her Lift the Middle Class Act. This would have delivered 88% of its benefits to earners under $119,000.
Harris might not promote this specific plan going forward, but it suggests she’d aim to direct benefits to moderate earners instead of the wealthiest. More recently, she’s proposed expanding the Child Tax Credit and adding a $6,000 credit for families with newborns.
By contrast, the tax bill that Trump signed delivered more than half its benefits to the top 5% of households—those with incomes over $263,000. (Like Harris, Trump’s vice presidential nominee, J.D. Vance, has suggested a bigger Child Tax Credit. But Vance has also floated making people without children pay more taxes.)
Taxing the wealthiest and big corporations would support care investments and make our tax code more fair. Strengthening care infrastructure would help us all thrive and make the economy stronger. But we need to collect sufficient revenue to support those transformational policies.
There is strong public support for better care and for fairer taxes. Tax justice advocates should call on both the Harris and Trump campaigns to commit to a fairer tax system—and to use the money it would raise to invest in the childcare, elder care, and healthcare our families need.
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To Protect Landmark Victories for Disability Rights, Fund Community Care
A lack of investment in home- and community-based services and the low wages that result threaten to turn back the clock due to a severe national shortage of direct support professionals.
Jul 07, 2024
This past June 22 marked 25 years since the Supreme Court ruled in the landmark case
Olmstead v. L.C. that individuals with disabilities have the right to live in their communities and in the most integrated setting possible.
To think about it a different way, it was only 25 years ago that our nation codified its rejection of the warehousing of human beings in large, state-run institutions, isolated from their families and from opportunities to enjoy independence and autonomy.
The two plaintiffs in the Olmstead case, Lois Curtis and Elaine Wilson, cycled through numerous institutions and hospitals through their childhoods due to their disabilities before they ended up at the state-run Georgia Regional Hospital. Doctors decided both women were ready to transition to community-based treatment that would offer greater independence, but the state stopped the women from moving, confining them to the institution several years beyond what was necessary.
Olmstead and the ADA were milestones meant to ensure the civil and human rights of people with disabilities, and we must protect them against the possibility of going backward.
The lawsuit these women filed against the state declared that the unjustified isolation they suffered as the result of their disability was discrimination under Title II of the Americans with Disabilities Act of 1990 (ADA).
Like the ADA, which will celebrate its own anniversary later this month, the court’s Olmstead decision came with a promise: It is “appropriate and required” that individuals with disabilities receive the support they need to thrive in our communities.
Since these landmark human rights victories, we have made significant progress. But a quarter-century later, a lack of investment in home- and community-based services and the low wages that result threaten to turn back the clock due to a severe national shortage of direct support professionals, or DSPs, who are the backbone of the disability service delivery system.
In fact, a survey of hundreds of disability service providers across the country in 2023 found that severe staffing challenges had them facing impossible choices. More than 3 in 4 providers reported that they are no longer accepting new referrals, while 63% were forced to close programs. Meanwhile, nearly a half a million people nationally are languishing on waiting lists for services.
DSPs support people with intellectual and developmental disabilities (I/DD) to carry out activities of daily living, find and maintain employment, develop and sustain meaningful relationships, and so much more.
One of us, Doug, is a DSP whose interest in supporting others dates back to childhood. When I was 10 years old, I often babysat a little boy with Down syndrome. Even at my young age, I was aware of how his family struggled to find resources for their son, cover mounting costs, and make ends meet.
But throughout my tenure as a DSP, I’ve only seen things get worse. The people I support see skyrocketing costs for everyday essentials. Whereas I used to be able to open my wallet to help with these costs from time to time, I’m finding my own finances stretched thinner and thinner. I recently agreed to begin supporting a second person, thinking it would help me bring in more income. Instead, the additional bills mean I’m only falling farther behind.
Nevertheless, I will continue committing to this work because of the impact I know I’m having in the lives of those I support. One of the people I work with is a 65-year-old disabled trans person. When we first started working together, he experienced debilitating anxiety, had no support from family or other natural networks, and felt completely ostracized from his community. By building trust, connecting him with local support groups, and supporting him to find safe spaces, he developed the courage to come out as trans and begin his transition.
The other one of us, Barbara, leads a national association representing thousands of disability service providers like those that employ outstanding DSPs like Doug. Our entire service delivery system rests on the civil rights promises made possible through legal landmarks like Olmstead. But without increased funding for these services to improve DSP wages, more people with I/DD will struggle to find—and keep—people like Doug committed to person-centered support. And that means longer waits for services and a higher risk of unnecessary institutionalization.
Olmstead and the ADA were milestones meant to ensure the civil and human rights of people with disabilities, and we must protect them against the possibility of going backward. Both state and federal leaders have the power to do just that, but they must be willing to commit to the long-term sustainability of the DSP workforce.
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