Maryland will need to spend more than $71 million over the next two years to meet SNAP and Medicaid requirements set out by the Trump administration’s 2025 tax and spending legislation, even though the law restricts the number of people on the rolls.
New work requirements and more frequent eligibility checks for Medicaid, ACA benefits and SNAP will add significant costs to Maryland’s Department of Health, Department of Human Services and the state’s health benefit exchange between 2026 and 2027.
The largest impact comes from the federal government shifting more administrative costs for SNAP onto states. Maryland will see more than $43 million in increased expenditures from that provision, which changes the cost sharing for staffing, technology and outreach from a 50/50 share between state and federal governments to a 25/75 share.
Another large piece, accounting for about $25 million, will come from IT system changes that the Maryland Health Benefit Exchange will need to implement to determine who is eligible for ACA benefits.
Other costs include about $2 million for MDH for 25 new positions “to implement new eligibility provisions, work requirements, and redetermination timelines required by H.R. 1,” according to a document provided by the state.
The health benefit exchange will need funding for an expected increase in calls to handle questions about new eligibility and enrollment changes. The exchange is also expecting a rise in appeals due to redetermination notices, which will account for millions of dollars.
This comes as the state will lose about $2.7 billion in Medicaid funding from the legislation and new analysis of the rules shows Maryland may be harder hit than originally anticipated with as many as 270,000 people losing coverage in 2028.
The loss will come from new requirements that force people on Medicaid to re-enroll more frequently and puts stricter work requirements on the health plan.
“A lot of people fall through the cracks and lose their coverage, even if they really are eligible and shouldn't lose their coverage because the state sets up a system that's too difficult for people to comply with,” said Katherine Hempstead, a senior policy analyst at the foundation.
MDH estimated about 175,000 thousand people will lose coverage between July of this year and June of 2028 shortly after the Republican spending and tax bill was passed that changed Medicaid requirements.
The law also did not reup the ACA tax credits, as other spending plans had in the past, causing Maryland’s ACA health plan premiums to spike an average of 13.4% this year.
