Key Takeaways

• LGBTQ+ adults face significantly greater challenges accessing and affording health care compared to their non-LGBTQ+ peers. They are more likely to postpone or skip needed care (58% vs. 38%), forgo prescription medications due to cost (22% vs. 12%), and struggle to pay medical bills (30% vs. 21%).
• Cost-related barriers to care are especially pronounced among certain segments of the LGBTQ+ population, most notably trans adults, younger LGBTQ+ adults, those with lower incomes, and those without health coverage. Eight in ten (82%) trans adults, three-quarters (77%) of LGBTQ+ adults without health coverage, and two-thirds (68%) of those under age 30 report not getting needed health care in the past 12 months either because they couldn’t get an appointment, couldn’t afford the cost, or for another reason. Additionally, larger shares of LGBQ+ women than men report skipping or delaying care in the past year (63% vs. 46%).
• While trans adults represent a small share of the total LGBTQ+ population, they experience outsized barriers to affording care and other access issues. Compared with other LGBQ+ groups, trans adults report the highest rates of difficulty finding providers with available appointments (53%), not taking prescription medications because of cost (39%), worsening health from postponed care (45%), struggling with medical bills (42%), and experiencing insurance delays or denials (61%). Trans adults experience these greater barriers to health cost and access even when controlling for other demographic variables such as age, income, and insurance status.
• Health care costs create significant financial strain for many LGBTQ+ adults. Three in ten (30%) report problems paying medical bills in the past year, and one in five (19%) say they cut back on household necessities such as food or clothing to pay for health care costs. Financial burdens are particularly common among younger adults, those with lower incomes, and those without health coverage.
• Having health insurance does not guarantee timely access to care. About three in ten LGBTQ+ insured adults report that their insurance delayed or denied coverage for recommended care in the past two years, a more widespread experience than among non-LGBTQ+ insured adults, with particularly high rates among trans adults and those covered by Medicaid or those with ACA marketplace coverage.

Understanding the Challenges LGBTQ+ Adults Face Affording Health Care

LGBTQ+ adults in the U.S. are a growing population who have historically faced health disparities in terms of both wellbeing and health care access and affordability. Previous research has found that LGBTQ+ adults are more likely than their non-LGBTQ+ peers to experience barriers to obtaining needed care, to struggle to afford health care costs, and to delay or forgo care because of cost. These affordability challenges often intersect with and may even be a driver of broader health disparities, including poorer mental and physical health outcomes, particularly among trans adults.

Understanding the financial challenges LGBTQ+ adults face when accessing health care can help identify persistent gaps in affordability and inform efforts to improve access to needed care and coverage.

Delays in Health Care for LGBTQ+ Adults

Six in ten LGBTQ+ adults (58%) say they have skipped or postponed needed health care in the past year, greater shares than their non-LGBTQ+ counterparts (38%). This includes more than four in ten (43%) LGBTQ+ adults who say they’ve skipped or delayed getting needed care because of the cost and about three in ten who said it was due to their inability to get an appointment (28%) or for some other reason (29%). LGBTQ+ adults are nearly twice as likely as non-LGBTQ+ adults (26%) to say they’ve skipped or delayed getting needed care because of the costs.

Compared to other LGBQ+ adults, trans adults are more likely to report they have put off care in the past year because of cost or other issues (82%). At least half of trans adults say they skipped or postponed getting needed health care because of the cost (56%), because they couldn’t find a doctor or health care provider with appointments available (53%), or they skipped or postponed for any other reasons (48%). There may be many reasons why trans adults are more likely to skip or delay care, but a recent KFF/Washington Post Trans Survey found significant barriers for trans adults in getting needed health care, including providers not being properly educated to provide appropriate care.

Beyond trans adults, larger shares of LGBQ+ women than men report skipping or postponing care in the past year (63% vs. 46%). This includes half of LGBQ+ women who say they skipped or postponed needed care because of the cost (compared to a third of LGBQ+ men), and roughly a third of LGBQ+ women who say they skipped or postponed care because they couldn’t get an appointment (31% vs. 19% of LGBQ+ men) or for any reason besides cost or not being able to get an appointment (32% vs. 21% of LGBQ+ men). Across all LGBTQ+ groups, non-LGBTQ+ adults less commonly reported skipping or postponing care.  

Many socioeconomic and demographic factors can predict delaying or skipping care, but LGBTQ+ adults are more likely to skip or delay care even when controlling for race and ethnicity, insurance coverage, age, income, and education, suggesting this population group may have unique struggles in accessing needed health care. The differences reported in this analysis between LGBTQ+ adults and non-LGBTQ+ adults hold even when controlling for these demographic characteristics.

Among all LGBTQ+ adults, two-thirds (68%) of those under age 30 report having put off needed care in the past year, higher than the shares of older LGBTQ+ adults who report this. While age is a significant predictor of putting off care regardless of sexual identity, LGBTQ+ adults under age 30 are twenty percentage points more likely to report putting off care than non-LGBTQ+ adults in the same age range (48%). In fact, across most age groups, LGBTQ+ adults are more likely to report putting off or postponing needed care than their non-LGBTQ+ counterparts, except for those 65 and older. The difference between LGBTQ+ and non-LGBTQ+ adults levels out among those age 65 and older, which may be due to several factors, such as increased medical care among older adults and Medicare eligibility.

Insurance and income also play a role in accessing care. Three in four (77%) LGBTQ+ adults without health insurance report having missed or delayed care in the past year for any reason, compared to six in ten LGBTQ+ adults with health insurance. Fewer non-LGBTQ+ adults than LGBTQ+ adults without health insurance report experiencing any of the following in the past year (65% vs. 77% of uninsured LGBTQ+ adults).

Similarly, about six in ten LGBTQ+ adults with household incomes under $40,000 a year (59%) or between $40,000 and $99,999 a year (63%) say they skipped or postponed needed care, compared to half of those with annual incomes of $100,000 or more. Even among the highest income groups or those with health insurance, LGBTQ+ adults are more likely than non-LGBTQ+ adults to say they skipped or delayed needed care in the past year.

Substantial shares of LGBTQ+ adults report postponing their care worsened their health, and that number is especially pronounced among trans adults. Three in ten (29%) LGBTQ+ adults say their health got worse because they skipped or delayed care, which is about twice the share of non-LGBTQ+ adults who report the same (14%). This experience is more common among LGBQ+ women (34%) than LGBQ+ men (20%). Almost half (45%) of trans adults say they delayed or skipped care and their health got worse as a result.

The share who say their health got worse due to postponing care also rises to roughly a third of uninsured LGBTQ+ adults (35%) and those under age 30 (35%). One-third (33%) of LGBTQ+ adults with household incomes of less than $40,000 report that their health got worse because of postponed care.

Impacts of Cost on Prescription Medications

Cost barriers also affect prescription medication behavior, including among LGBTQ+ adults, with about a fifth of LGBTQ+ adults (22%) saying they’ve cut pills in half, skipped doses of a medication, or decided not to fill a prescription because they couldn’t afford the cost (compared to 12% of non-LGBTQ+ adults). Trans adults (39%), LGBTQ+ adults without insurance (28%), LGBQ+ women (25%), and younger LGBTQ+ adults (23% of those under age 30), are the most likely to report that they didn’t take their prescription medication as prescribed due to cost.

In addition, around a quarter of LGBTQ+ adults with lower incomes report cutting pills in half, skipping doses of medications, or not filling a prescription in the past year due to cost, including 27% of those with a household income of less than $40,000 a year, and 24% of those with incomes between $40,000 and $99,999 a year, compared to around one in ten (12%) of LGBTQ+ adults with incomes of $100,000 or more a year.

Difficulty Paying Medical Bills

Substantial shares of LGBTQ+ adults also report struggling with medical bills. Three in ten LGBTQ+ adults say they have had problems paying for or were unable to pay a medical bill, including bills for doctors, tests or labs, or medication in the past 12 months, higher than the 21% of non-LGBTQ+ adults who say the same. This includes four in ten (42%) trans adults, over a third (36%) of LGBQ+ women and two in ten (21%) LGBQ+ men.

Problems with bills can lead to important financial consequences for many LGBTQ+ adults. Two in ten (19%) LGBTQ+ adults, including two in ten (22%) LGBQ+ women and roughly one in ten (13%) LGBQ+ men say they’ve had to cut back on household expenses like food, clothing, or other basic household items in order to pay for health care costs. This experience is more common among trans adults, over one quarter of whom (28%) report the same. Overall, LGBTQ+ adults report they have cut back on necessities to pay for health care costs more commonly than non-LGBTQ+ adults (13%).

Younger LGBTQ+ adults and those with lower household incomes, two groups with considerable overlap, are among the most likely to report problems paying medical bills in the past year, with around a third of those under age 30 (33%), between 30 and 49 (34%), those with incomes of less than $40,000 a year (35%) or between $40,000 and $99,999 (35%) reporting they had problems paying or an inability to pay for any medical bills in the past year. Individuals earning over $100,000 annually and those 65 and older, who are largely covered by Medicare, are less likely to report such problems.

Younger LGBTQ+ adults and those with lower incomes are also more likely to report cutting back on expenses because of their problems paying medical bills. Overall, a quarter (24%) of LGBTQ+ adults with household incomes less than $40,000 a year say they have cut back on household expenses like food, clothing or other basic household items to pay for health care costs, compared to two in ten (19%) LGBTQ+ adults with incomes between $40,000 and $99,999 and one in ten (11%) of those with incomes of $100,000 or more a year.

Younger LGBTQ+ adults are also more likely to report cutting back on expenses because of trouble paying medical bills, including two in ten LGBTQ+ adults under age 30 and between ages 30 to 49 (21% for each) compared to one in ten (13%) LGBTQ+ adults ages 50 to 64 and one in twelve (8%) of those ages 65 and older.

Insurance Delays or Denials

Treatments or medications recommended by a provider may be delayed, and in some cases, an insurance company may deny coverage for the recommended medication or treatment after or during the care process. While insurance coverage helps some LGBTQ+ adults deal with access and cost issues, many face other challenges such as delayed or denied care.

Roughly one-third of insured LGBTQ+ adults say their insurance company denied coverage (32%) or delayed (30%) their ability to get a health care service, treatment, or medication that their doctor prescribed in the past two years. Four in ten say coverage has either been delayed or denied. These shares are substantially higher than among non-LGBTQ+ adults, about a quarter (26%) of whom say they’ve experienced a denial of service (21%) or delay (17%) in the past two years.

These experiences are particularly common among trans adults, roughly six in ten (61%) of whom say they’ve been delayed (53%) or denied (45%) coverage by their insurance for a service, treatment, or medication prescribed by their doctor in the past two years.

Delays and denials of coverage for LGBTQ+ adults vary based on what type of insurance they have. Individuals with either self-purchased plans or Medicaid report experiencing these most often. Roughly half (48%) of LGBTQ+ adults under age 65 who have Medicaid (48%) or self-purchased insurance (46%) say their insurance company has denied or delayed health care services, treatments, or medications in the past two years. Given that Medicaid plays a larger role in covering LGBTQ+ people, this coverage difference may in partially explain some of the disparate challenges this group faces with delays and denials.  

Roughly four in ten (39%) LGBTQ+ adults under age 65 with employer-sponsored insurance say the same while just three in ten (28%) LGBTQ+ adults ages 65 and older with Medicare report experiencing recent delays and denials.

The share of LGBTQ+ adults with various types of health insurance who report delays or denials of needed care is larger than the share of non-LGBTQ+ adults who say the same. Roughly a third of those non-LGBTQ+ adults with Medicaid (33%) or self-purchased insurance (31%), around a quarter (26%) of those with employer-sponsored coverage, and around two in ten (18%) of non-LGBTQ+ adults who have Medicare and are ages 65 or older report these issues.

The KFF Survey of Health Status and Caregiving was a series of questions designed and implemented by KFF with the SSRS Opinion Panel Mega-Omnibus. The survey was conducted May 4 – May 26, 2026, online and by telephone among a nationally representative sample of 25,873 U.S. adults in English (n=25,422) and in Spanish (n=451).

The SSRS Opinion Panel is a nationally representative probability-based panel where panel members are recruited randomly in one of two ways: (a) Through invitations mailed to respondents randomly sampled from an Address-Based Sample (ABS) through the U.S. Postal Service’s Computerized Delivery Sequence (CDS); (b) recruited via random digit dial (RDD) telephone sample of cell phone numbers connected to a prepaid cell phone. Both samples were provided by Marketing Systems Group (MSG). The combined sample was reached either online (n=24,875) or over the phone (n=998) based on the panelist’s stated preference. For the online panel component, invitations were sent to panel members by email followed by up to four reminder emails and up to two reminder text messages (if consented to receive SMS).

The questions designed by KFF were included as part of a multi-stakeholder effort designed to survey all individuals currently empaneled in the SSRS Opinion Panel, with each organization paying for and having independent editorial control over its survey questions.  Substantive questions from other outside stakeholders are redacted in this report. The SSRS survey team designed the questionnaire in order to minimize potential bias from question ordering. For more information, please contact SSRS.

Respondents who completed on the web received a $5 electronic gift card incentive (some harder-to-reach groups received a $10 electronic gift card). Respondents who completed the survey on the phone received $10 via a physical check in the mail. In order to ensure data quality, cases were removed if they failed two or more quality checks: (1) attention check questions in the online version of the questionnaire, (2) had over 10% item non-response, or (3) had a length of less than 30% of the mean length by mode. Based on this criterion, 69 cases were removed.

Data were weighted to represent adults 18+ in the United States. The Panel-wide base weight adjusts for the SSRS Opinion Panel recruitment and retention process. Because all current panelists (except 2026 recruits) were invited to participate and no further sampling was performed, no further adjustments to the Panel-wide base weight were necessary before applying it to the survey data.

With the Panel-wide base weight applied, the survey-data were weighted to match the sample’s demographic profile to the same target population parameters used in the calibration of the entire SSRS Opinion Panel. The demographic variables included in weighting for the general population sample are gender, age, race/ethnicity, and education (including interactions between these categories), as well as region, civic engagement, density, frequency of internet use, voter registration, political party identification, religion, household makeup, and home ownership. Final calibrated weights are trimmed at the 2^nd and 98^th percentiles to prevent individual interviews from having too much influence.

The margin of sampling error including the design effect for the full sample is plus or minus 1 percentage points. Numbers of respondents and margins of sampling error for key subgroups are shown in the table below. For results based on other subgroups, the margin of sampling error may be higher. Sample sizes and margins of sampling error for other subgroups are available on request. Sampling error is only one of many potential sources of error and there may be other unmeasured error in this or any other public opinion poll. KFF public opinion and survey research is a charter member of the Transparency Initiative of the American Association for Public Opinion Research.

Medicaid, the nation’s health coverage program for people with low incomes, provides more than 39 million women across the nation with health and long-term care coverage. Women comprise the majority of the adult Medicaid population and the program offers coverage of a wide range of primary, preventive, specialty, and long-term care services that are important to women across their lifespans. Given the importance of the program for women and their families, changes to the program, such as the 2025 federal policy changes to Medicaid and the enactment of new work requirements for the Medicaid expansion population, will have significant implications for low-income women’s access to coverage and care. This data note presents key data points describing the current state of the Medicaid program as it affects women.  

In 2023 adult women comprised 37% of the overall Medicaid population and the majority of adults on the program (Figure 1).¹ Prior to the 2010 Affordable Care Act (ACA), women were more likely to qualify for Medicaid than men because of their lower incomes and because they were more likely to belong to one of Medicaid’s categories of eligibility for adults: pregnant, parent of a dependent child, senior, or person with a disability. The ACA added a new Medicaid eligibility category by extending Medicaid eligibility to nearly all adults under age 65 with incomes up to 138% of the federal poverty level (FPL), though women are still more likely than men to be covered by Medicaid.

• As of May 2026, 40 states and DC have opted to expand eligibility for Medicaid under the ACA, which allows women and men with low incomes below 138% FPL to qualify regardless of their pregnancy, parenting or disability status.  
• In the 10 states that have not expanded Medicaid under the ACA, adults only qualify if they meet income criteria AND belong to one of the previously mentioned categorical eligibility groups. While there are federal eligibility minimums, states have the option to expand eligibility levels for each group up to certain limits. As a result, income eligibility criteria vary for different groups of beneficiaries within as well as between states.
• In the states that have not adopted the ACA Medicaid expansion, approximately 576,000 women ages 19 to 64 with incomes below the federal poverty level and who are uninsured fall into a “coverage gap.” This is because they earn too much money to qualify for Medicaid in their state but not enough to qualify for assistance purchasing a private policy through their state’s ACA Marketplace, which is available for individuals with incomes between 100% FPL and 400% FPL.
• H.R. 1, the 2025 budget reconciliation law, has made significant changes to the Medicaid program. For the first time, eligibility for adults in the ACA Medicaid Expansion group will be conditioned on meeting work requirements, starting January 1, 2027. Prior KFF research has shown that most adult women covered by Medicaid meet work requirements or could qualify for one of the law’s exemptions (including being a parent of a child under age 14), but they are at risk of losing coverage because of the administrative burdens related to reporting requirements. In 2023, approximately 40% of adult women enrolled in Medicaid were enrolled via the ACA expansion pathway.² The Congressional Budget Office (CBO) estimates that these requirements will reduce federal Medicaid spending by $326 billion over the next 10 years but will also increase the number of uninsured by 5.3 million in 2034.

Medicaid covers a diverse population of women who face many social, economic, and health challenges that affect their ability to receive timely and high-quality health care.  

• In 2024, Medicaid covered 18% of adult women ages 19 to 64 in the United States, but coverage rates were higher among certain groups, such as women of color, single mothers, low-income women, and women who have not completed a high school education (Figure 2).  

• Differences in Medicaid eligibility levels and poverty rates across the states translate into vastly different Medicaid coverage rates for women across states, from a low of 9% in Utah and Texas to 32% in New Mexico (Figure 3).  

Adult women of reproductive age (19 to 49) comprise a quarter (24%) of the Medicaid population (Figure 1). Medicaid covers a wide range of reproductive health care services, including family planning, and pregnancy-related care including prenatal services, childbirth, and postpartum care—all without cost-sharing. Medicaid coverage of abortion services, however, is very limited under federal law and in most states.  

Family Planning 

Federal law requires state Medicaid programs to offer family planning benefits, but states determine the specific services and supplies for those who qualify through pre-ACA pathways. For the ACA expansion populations, the ACA requires states to cover all FDA approved, granted, and cleared  contraceptive methods, counseling on STIs and HIV, and screening for breast and cervical cancers. Research has found that most states have aligned their benefits and cover these services across all eligibility groups.  

• The federal government pays 90% of costs for family planning services, a higher federal matching rate than for other services (typically between 50% and 78%). Women covered by Medicaid cannot be charged any out-of-pocket costs for family planning services. 
• Federal law states that Medicaid beneficiaries have “free choice of provider,” which allows them to seek care from any qualified participating provider that offers the services. However, contrary to longstanding interpretation of the free choice of provider clause, a 2025 Supreme Court ruling, Medina v. Planned Parenthood South Atlantic, allows state Medicaid programs to disqualify clinics from participating in their networks if they offer abortion care in addition to other medical services. As of June 2026, at least seven states (AR, MO, MS, NE, OK, SC, and TX) have bans on Planned Parenthood’s participation in Medicaid, and several other states have proposed similar policies. Nationally, one in ten (10%) reproductive age women covered by Medicaid who received family planning services got their care at a Planned Parenthood clinic in 2023.
• In addition to the Medina ruling, H.R.1 established a one-year ban on federal Medicaid reimbursements to Planned Parenthood in all states and some other reproductive health providers that provide abortion services. The policy was in effect from July 2025 to July 2026. While this rule expired, future legislation could be enacted by Congress to reinstate this funding ban.
• Over half of states currently operate limited scope Medicaid family planning programs, which extend access to family planning services to uninsured women who do not qualify for full Medicaid coverage (often because their incomes exceed the Medicaid income thresholds).  

Maternity Care  

Medicaid is the largest single payer of pregnancy-related services, financing 40% of all U.S. births in 2024. In three states Medicaid covers more than 50% of all births. By federal law, all states provide Medicaid coverage without cost sharing for pregnancy-related services to pregnant people with incomes up to 138% of the federal poverty level (FPL), but many states extend eligibility to those at higher income levels. 

• Similar to family planning, there is no federal definition of what services states must cover under their traditional Medicaid programs for pregnant women beyond inpatient and outpatient hospital care, but states that have expanded Medicaid eligibility must cover all preventive services recommended by the United States Preventive Services Task Force (USPSTF) to individuals who qualify through this pathway, which includes a broad range of pregnancy-related preventive services. Overall, most states cover a broad range of maternity care services, including prenatal screenings, folic acid supplements, and breastfeeding supports. States may not charge cost-sharing for any pregnancy-related services.
• Historically, Medicaid coverage for pregnant people ended after 60 days. Due in part to the high rates of maternal mortality and morbidity in the United States and the disproportionately high rates of poor maternal outcomes experienced by Black and Native American pregnant people, there was a growing interest in expanding postpartum coverage beyond the 60 days. The federal American Rescue Act of 2021 gave states the option to extend postpartum coverage to pregnant people to a full year. To date, all states, with the exception of Arkansas, have extended postpartum coverage to 12 months.   
• In the 10 states that have not expanded Medicaid coverage under the ACA, many women lose Medicaid eligibly after the postpartum period. This is because the income eligibility for pregnancy-related care is typically considerably higher than that offered to parents of dependent children. Eligibility levels for parents in the states that have not expanded Medicaid range from 15% FPL in Texas to 105% FPL in Tennessee (Figure 4). In the states that have expanded Medicaid eligibility, most women with Medicaid financed births are able to remain enrolled in the program and have continuous coverage beyond the postpartum period. 

Abortion  

While the 2022 Dobbs decision overturning Roe v. Wade eliminated federal protections and allowed states to ban or severely restrict the provision of abortion, abortion remains legal and available in many states. However, the federal Hyde Amendment prohibits federal spending on abortions in all states, except when the pregnancy is a result of rape or incest, or when it jeopardizes the life of the pregnant person (Figure 5). States may use their own unmatched funds to cover abortions in other circumstances. As of July 2026, 29 states (including the 13 states where abortion provision is currently banned) and DC follow Hyde restrictions and 21 states cover abortions for Medicaid beneficiaries that are considered to be “medically necessary” and pay for these using only state funds. Nearly half of women of reproductive age with Medicaid coverage live in a state that follows Hyde amendment standards or currently bans the provision of abortion. In cases when Medicaid finances abortions for Medicaid enrollees, reimbursement rates tend to be low and often do not cover the full cost of the procedure.

As women age, their health needs generally shift from reproductive care to greater need for screening and management of chronic diseases, mental health care, and disability care (although many women in their reproductive years also have these health needs).  

Mental Health  

• In 2024, Medicaid covered over one in four (27%) adult women with any mental illness and 31% of adult women with a serious mental illness. 
• Medicaid’s behavioral health benefits include acute care services, long-term services and supports to enable people with chronic illness to receive community-based care. In addition, states with Medicaid expansion programs are required to cover 10 essential health benefits, which include mental health and substance use disorder services, including behavioral health treatment.  

Breast and Cervical Cancers 

• Under the Breast and Cervical Cancer Prevention and Treatment Act, states may extend Medicaid coverage for cancer treatment to uninsured women diagnosed with breast or cervical cancer through a federal screening program and receive a federal match for those services. In 2023, 44,000 women were enrolled in Medicaid through the Breast and Cervical Cancer Program.  
• Preventive services for breast and cervical cancers are required benefits in ACA Medicaid Expansion programs. States are required to cover mammograms and pap tests, genetic (BRCA) screening for high-risk women, and breast cancer preventive medication for high-risk women. Most states cover the screening tests for all beneficiaries. However, coverage for other services such as such as colposcopy following an abnormal pap result (which will be a required as a covered services under the HRSA Women’s Preventive Services  Guidelines effective January 2027) and genetic screening for women at higher risk of breast cancer is more uneven across state eligibility pathways.  

Women with Disabilities  

• Medicaid covers four in ten (41%) nonelderly women who have a broad range of physical and mental disabilities, including physical impairments, severe mental illnesses, and specific conditions such as muscular dystrophy, cystic fibrosis, and HIV/AIDS (Figure 6).³ In addition, Medicaid also covers some nonelderly women who separately also qualify for Medicare coverage due to long-term disabilities (discussed below). 
• Benefits that Medicaid covers include: assistance with medical and supportive services including rehabilitation, transportation, and therapeutic services, which help people with disabilities live independently and are not typically covered by private health insurance plans. Long-term services, including home health care, are another critical health benefit for women with disabilities that has very limited coverage through commercial plans but is covered by Medicaid.  

Medicare-Medicaid Enrollees and Long-Term Care 

Medicare provides health coverage to people 65 and older and younger people with long-term disabilities. Medicaid provides coverage to approximately 12 million Medicare beneficiaries (20% of all Medicare beneficiaries) with low incomes and modest assets. These individuals are often referred to as “dually eligible beneficiaries,” and in 2023, women of all ages accounted for 60% of this group (Figure 7). Many of these beneficiaries have extensive and costly health needs.  

• The majority of dually eligible beneficiaries qualify for full Medicaid benefits and may receive coverage for services that Medicare does not currently cover, such as dental and vision care, and long-term services and supports. Other dually eligible beneficiaries may only receive assistance with their Medicare premiums and/or cost sharing through the Medicare Savings Programs, but not full Medicaid benefits, if they meet an income and asset test. 

• Medicaid covers a continuum of long-term services and supports ranging from home care (HCBS) that allow persons to live independently in their own homes or in other community settings to institutional care provided in nursing facilities and intermediate care facilities for individuals with intellectual disabilities. In 2023, HCBS represented 64% of total Medicaid expenditures on long-term care (LTC).  
• Since women are more likely to live longer and experience higher rates of chronic illness and disability than men, they are more likely to require long-term services in their lifetime. Approximately two-thirds of nursing home residents (61%) and people receiving home health care (60%) are women. Medicaid coverage provides access to these long-term services, which would otherwise be unaffordable for women with fixed incomes (in 2025, nursing home care averaged more than $114,975 annually for a semi-private room).  

Compared to their uninsured counterparts, women with Medicaid experience fewer barriers to care and on several measures have utilization rates comparable to low-income women with private insurance.  

• Women covered by Medicaid use primary and preventive health services, such as pap smears and mammograms, at rates comparable to women with private insurance and at higher rates than uninsured women (Figure 8).  

• Women with Medicaid coverage are less likely than uninsured women to experience cost barriers. Compared to low-income women with private insurance, women on Medicaid were less likely to report that they delayed or went without care due to cost, likely attributable to the fact that Medicaid does not charge deductibles, rarely charges premiums and has only nominal cost-sharing. Affordability, however, is still a problem for some women in the program because they are typically low-income and have to pay out of pocket costs in states that impose caps on the number of covered visits or prescriptions or charge copayments for prescription drugs (for non-pregnant adults). Three in 10 low-income women on Medicaid report that they had not filled a prescription (31%) in the past year because of the cost (Figure 9).  

1. KFF analysis of the T-MSIS Research Identifiable Files, 2023 (Preliminary) ↩︎
2. KFF analysis of the T-MSIS Research Identifiable Files, 2023 (Preliminary) ↩︎
3. KFF estimate based on the 2024 American Community Survey, 1-year estimates ↩︎

The 2025 reconciliation law imposes significant new restrictions on states’ ability to generate Medicaid provider tax revenue, including prohibiting all states from establishing new provider taxes or from increasing existing taxes as well as reducing existing provider taxes for states that have adopted the Affordable Care Act (ACA) Medicaid expansion. Medicaid is jointly financed by the federal government and the states, with the federal government guaranteeing states federal matching payments with no pre-set limit. In federal fiscal year (FFY) 2024, the federal government paid 65% and states paid 35% of total Medicaid costs. States are permitted to finance the non-federal share of Medicaid spending through multiple sources, including state general funds, health-care related taxes (referred to as “provider taxes” throughout this brief), and local government funds.

Changes to provider tax rules will have significant effects on state budgets and may make it difficult for states to maintain current Medicaid spending without increasing state general fund spending; but could increase transparency around Medicaid financing. The changes come at a time when states are already experiencing overall slower revenue growth, and it is unclear how states will be able to make up the lost revenues. The changes could exacerbate existing state budget challenges and result in lower provider payment rates or reductions in Medicaid benefits or coverage, although the effects will vary by state.

This issue brief uses data from KFF’s 2025-2026 survey of Medicaid directors and from a proposed rule on provider taxes to describe states’ current provider taxes, explore how rules governing provider taxes are changing because of the 2025 reconciliation law and the regulations implementing that law, and summarizes which changes may affect each state.

1.How have states used provider taxes to help finance the state share of Medicaid?   

KFF’s 2025 Medicaid Budget Survey found that the majority of state Medicaid spending came from general fund revenues, but provider taxes contributed 18%. States have considerable flexibility in determining how to finance the state (or non-federal) share of Medicaid payments, within certain limits. Across all states, most of the state share of Medicaid spending comes from state general funds, but there is considerable variation in how much states rely on other funding sources. KFF’s 2025 Medicaid budget survey found that general funds accounted for a median of 70% of the non-federal share in state fiscal year (FY) 2026 enacted budgets, while provider taxes accounted for 18%, and funds from local governments or other sources accounted for 6% (this is relatively similar to 2018 data on non-federal share funding sources reported by the Government Accountability Office (GAO) and 2024 data on general fund spending from the National Association of State Budget Officers (NASBO)). 

All states but Alaska finance part of the state share of Medicaid funding through at least one provider tax and 41 states have three or more provider taxes in place (Figure 1). Medicaid provider taxes are defined as those for which at least 85% of the tax burden falls on health care items or services or entities that provide or pay for health care items or services (see Social Security Act, Section 1903(w)(3)(A)). Provider taxes may be imposed as a percentage of provider revenues or using an alternative formula such as a flat tax on the number of facility beds or inpatient days. States use provider tax revenues to fund Medicaid “base” rates and supplemental payments; to finance eligibility expansions, including the ACA Medicaid expansion; or to more generally support the Medicaid program. Over time, states have increased their reliance on provider taxes, with expansions often driven by economic downturns or a desire to fund eligibility expansions or provider reimbursement increases. Beyond helping finance the state share of Medicaid, permissible tax arrangements may have potential financial benefits for providers who are subject to the tax and serve a high volume of Medicaid patients.

Provider taxes are most common for institutional providers. That includes hospitals (47 states), nursing facilities (45 states), and intermediate care facilities for people with intellectual or developmental disabilities (33 states, Figure 2). Provider tax revenues often finance supplemental payments to institutional providers, which may be a major source of revenues for those providers. Payment policies vary considerably by state, and research has shown that Medicaid base payment rates are below those of Medicare and often below hospitals or nursing facilities’ costs of providing services to Medicaid enrollees, causing some states to rely more heavily on supplemental payments than others to help cover costs. Beyond institutional providers, states have taxes on managed care organizations (MCOs) (22 states), ambulance providers (21 states), and “other” provider types (9 states) such as ambulatory care facilities and home care providers. Provider tax revenues are most likely to be near the 6% safe harbor limit (described in more detail below) for nursing facilities followed by hospitals and intermediate care facilities for people with intellectual or developmental disabilities (Figure 2).

CMS estimates that states will collect nearly $100 billion in provider tax revenues in 2026, mostly from hospital taxes (Figure 3). Historically, the federal government did not provide consistent or comprehensive publicly available data about states’ provider tax policies or revenue collections. In June 2024, the Medicaid and CHIP Payment and Access Commission (MACPAC), called for increased transparency over how states financed the non-federal share of Medicaid payments. However, CMS requested additional data from states about their provider taxes in 2025 and 2026. Using those data and their own projections, CMS estimates that tax revenues in calendar year 2026 will be $98.6 billion, with $61.8 billion coming from taxes on hospitals and $28.1 billion coming from taxes on managed care organizations.

2. What federal rules governed provider taxes before the 2025 reconciliation law?

Since the 1990s, federal rules governing provider taxes have included three core components—requiring taxes to be “broad-based,” “uniform,” and not hold providers “harmless.” Provider taxes were established in the 1980s, but particularly aggressive use of provider taxes following their establishment in the 1980s led to statutory and regulatory limitations beginning in the 1990s. Federal rules prior to passage of the 2025 reconciliation law specified that provider taxes must be:

• Broad-based, which means the tax is imposed on all providers within a specified class of providers (e.g., the tax cannot be imposed only on providers that see primarily Medicaid patients);
• Uniform, which means the tax must apply equally to all providers within the specified class (e.g., the tax rate cannot be higher on Medicaid revenue than non-Medicaid revenue); and
• Not hold taxpayers (providers) “harmless,” which means states are prohibited from directly or indirectly guaranteeing that providers will receive their tax costs back (i.e., be “held harmless”).

To ensure tax programs are “broad-based,” CMS has specified 19 classes of providers (see 42 CFR Section 433.56). States may obtain “uniformity waivers” of the requirements that taxes be broad-based and uniform if the state can prove the net effect of the tax is “generally redistributive,” and the amount of tax is not directly related to Medicaid payments. In assessing whether provider taxes comply with federal laws, regulations specify that the hold harmless requirement does not apply when the tax revenues comprise 6% or less of net patient revenues from treating patients (see 42 CFR Section 433.68), a level sometimes referred to as a “safe harbor” or “hold harmless” limit.

3. What are new federal rules related to provider taxes?

Changes in the 2025 Reconciliation Law

The 2025 reconciliation law, signed by President Trump on July 4, 2025, imposes significant new restrictions on states’ ability to generate Medicaid provider tax revenue. The Congressional Budget Office (CBO) estimated provider tax policy changes from the 2025 reconciliation law would reduce federal Medicaid spending by $226 billion between 2025 and 2034. Those savings reflect the following changes to federal rules:

• An effective prohibition on new provider taxes or increases to existing ones ($89 billion in savings). The law effectively prevents the enactment of any new provider taxes by establishing a hold harmless limit of 0% for any taxes that were not in effect as of July 4, 2025. It also prevents any increases to existing provider taxes, which are capped at their rates as of July 4, 2025.
• Reduced limits on provider taxes in states that adopted the Affordable Care Act (ACA) Medicaid expansion ($102 billion in savings).  Beginning in FFY 2028, the law gradually reduces the hold harmless limit for states that have adopted the ACA expansion by 0.5% annually until the safe harbor limit reaches 3.5% in FFY 2032. The new limits apply to all provider taxes except for those levied on nursing facilities and intermediate care facilities.
• Revisions to the conditions under which states may receive uniformity waivers ($35 billion in savings). Effective July 5, 2025, the law prohibits states from using uniformity waivers if the tax charges higher or lower rates based on the volume of Medicaid revenues or patients.

Changes in the July 2026 CMS Proposed Rule

CMS released a proposed rule in July 2026 to implement the hold harmless provisions in the 2025 reconciliation law, which included some provisions not required under the law. The list below highlights some of the key provisions included in the proposed rule:

• Broader interpretation of taxes “in effect.” Under the proposed rule, CMS would recognize provider taxes as being in effect as of July 4, 2025 or earlier if they had been enacted. This is less restrictive than guidance issued in November 2025, which also required that all applicable uniformity waivers to have been approved by July 4, 2025 and for states to be “actively collecting” revenues as of July 4, 2025.
• Establishing health insurers as a permissible class of providers. Although not required by the 2025 reconciliation law, the rule proposes to add a new “health insurer” provider class to expand CMS oversight of health-care related taxes that goes beyond the existing “MCO” provider class including Health Maintenance Organizations and Preferred Provider Organizations. The proposed rule does not define the new class, but CMS is seeking comments on the potential scope of the new provider class. Such taxes would be subject to all other requirements governing Medicaid provider taxes, including new limits in the 2025 reconciliation law. CMS notes that these taxes are often imposed through state insurance commissions or departments.
• Discontinuation of the 75/75 test. The 2025 reconciliation law did not address the “75/75” test, under which taxes exceeding the hold harmless limit could remain permissible as long as more than 75% of taxpaying providers do not receive more than 75% of the cost of the tax back through enhanced Medicaid or other state payments. Starting in FFY 2027, the proposed rule would discontinue the 75/75 test.
• Enhanced Reporting Requirements and Compliance System. The proposed rule would significantly expand state reporting requirements and introduce retrospective CMS review to determine ongoing state compliance with the new hold harmless limits. States would be required to submit data (interim in 2026 and final in 2028) to CMS to determine applicable hold harmless limits as of July 4, 2025. States would also be required to submit quarterly reports beginning October 1, 2026, supplying tax collection data as well as information on how tax revenues are used by the state and whether public providers are exempt from the tax.

Under the proposed rule, CMS estimates that federal Medicaid spending would decrease by $246 billion over the next ten years (2026- 2035). This is similar to the CBO estimates although the CBO estimate does not include effects for the year 2035, which accounted for $44 billion of CMS’ total federal spending reduction. While the difference in estimates is relatively small, there are a few key differences in the agencies’ assumptions:

• States response. CBO assumed that states would replace 50% of the lost provider tax revenues with other funding sources but CMS assumes they will only replace 30%.
• Coverage loss. CBO estimated that provider tax changes in the 2025 reconciliation law will increase the number of uninsured people by 1.2 million by 2034, but CMS estimates that there will be no enrollment loss associated with the loss of revenues. 

4. Which states may face reductions in existing provider tax revenues?

States that have adopted the ACA Medicaid expansion and have certain provider taxes above the new hold harmless limits will face reductions in existing provider tax revenues. KFF data show that an estimated 31 states will have to reduce one or more provider taxes on hospitals, MCOs, or ambulances because of the lower hold harmless limits in ACA expansion states (Figure 4). Additional states are likely to be affected because of taxes on other classes of providers. Hospital taxes are the most frequently affected, with 28 of the 31 affected states having a hospital tax over 3.5% of net patient revenues as of July 1, 2025. Over half of the Medicaid provisions in the 2025 reconciliation law apply only to ACA expansion states, including the lower hold harmless limits. Those changes—coupled with lower provider tax revenues—may make it particularly difficult for ACA expansion states to navigate a challenging fiscal climate and increasing numbers of uninsured residents.

If CMS’ proposed regulation is finalized with the new health insurer provider class, additional states will be affected, though it is unclear how many states currently have such taxes in place. CMS’ decision to establish health insurers as a provider class for the purposes of Medicaid provider tax rules means that additional taxes will be subject to new hold harmless limits and in ACA expansion states, additional taxes may be subject to the decreasing hold harmless limits over time.

5. Which states may need to rework their “uniformity waivers?”

Uniformity waivers have allowed states to waive the requirement that provider taxes be broad-based and uniform if CMS determines that the tax is “generally redistributive.”  Provider taxes established through such waivers have generally taxed some types of providers within a class more heavily than others. States may use uniformity waivers to achieve policy goals such as limiting tax burdens for sole community hospitals, rural hospitals, or other vulnerable providers; but states have also used the waivers to impose taxes primarily on Medicaid providers. The disproportionate taxation of Medicaid providers has raised CMS concerns, including during the Biden Administration, and in May 2025, the Trump Administration released a proposed rule that aimed to address those concerns. The final rule was published on February 2, 2026 (Box 2).

The 2025 reconciliation law prohibits states from using uniformity waivers if the tax charges higher or lower rates based on the volume of Medicaid revenues or patients. The law specifies that taxes may not be considered generally redistributive if the state effectively varies tax rates based on the providers’ Medicaid revenues or patients, even if the tax does not explicitly name “Medicaid” when establishing the tax rates. The requirement is largely targeted at MCO taxes but may also apply to other provider tax types. It is effective as of July 5, 2025, but the Secretary may give states up to three fiscal years to come into compliance. The final rule on uniformity waivers provides states with transition periods that depend on what type of tax the waiver applies to and the most recent date of CMS approval for the waiver. Specifically:

• For taxes on MCOs with a waiver approval within 2 years of April 3, 2026, states have until the end of the current calendar to transition their taxes (this is expected to be the case in California and at least three other states).
• For all other taxes on MCOs, states have until the end of FY 2027 (which in most states, means they would need to be complying by July 1, 2027).
• For taxes on entities other than MCOs, states have through the end of FY 2028 to come into compliance.

States may come into compliance by either submitting a new waiver proposal that meets the new requirements from the final rule (Box 2) or they may otherwise modify their tax such that no waiver is necessary.

The final rule states that new limits on uniformity waivers will affect at least nine taxes in at least seven states, with effects starting as early as January 1, 2027 (Figure 5). CMS did not identify the specific states in the final rule, but in the proposed rule, CMS specifically named California, Massachusetts, Michigan, and New York as being affected.  KFF and other researchers expect that the other three states are Illinois, Ohio, and West Virginia. The final rule states that existing MCO taxes would now be prohibited in seven states unless the taxes were modified, and that within those seven states, there were at least two additional taxes affected, including one on hospitals and one on nursing homes. However, elsewhere, in the preamble to the final rule, CMS indicated that there were two nursing facility taxes that would now be prohibited. (It’s unclear whether the second nursing facility tax is within the seven states or in an eighth state.) CMS indicates that additional taxes may need to be modified or eliminated, but it is unknown which states have such taxes or what types of providers the taxes pertain to. Beyond uncertainty surrounding the scope of affected taxes, much remains unknown about how states may respond to the new rule.