Michigan Budget Director Outlines Plans to Address Medicaid Cuts, Health Care Costs

Flood says governor's budget proposal will seek to maintain health care access despite federal funding reductions.

Feb. 3, 2026 at 5:39am

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Michigan's State Budget Director Jen Flood has revealed that the governor's upcoming budget proposal will focus on addressing the impact of federal Medicaid funding cuts and rising health care costs across the state. Flood noted that the cuts could lead to over 200,000 Michiganders losing Medicaid coverage, and the administration is prioritizing efforts to ensure residents maintain access to health care services.

Why it matters

Medicaid is a critical component of Michigan's health care system, covering over 1 in 4 state residents, including children, seniors, and those with disabilities. The proposed federal funding reductions and new eligibility requirements pose significant challenges for the state in maintaining affordable and accessible health care, especially for vulnerable populations.

The details

Flood stated that the governor's budget will focus on easing Medicaid redetermination processes to help people retain coverage, as well as investing more in the Michigan Department of Health and Human Services to improve outreach and enrollment. Additionally, the administration is looking to address rising health care costs across the board, including higher premiums in the Affordable Care Act marketplace.

  • The governor's budget proposal will be presented to state lawmakers on February 11, 2026.
  • Federal Medicaid funding cuts and new eligibility requirements went into effect at the start of 2026.

The players

Jen Flood

Michigan State Budget Director, who outlined the governor's plans to address Medicaid cuts and health care costs.

Gretchen Whitmer

The Governor of Michigan, whose administration is prioritizing health care access and affordability in the upcoming state budget.

Elizabeth Hertel

Director of the Michigan Department of Health and Human Services, who discussed the impacts of rising health care costs and loss of coverage.

Matt Hall

Republican Speaker of the Michigan House of Representatives, who called for more spending cuts to address "waste, fraud and abuse" in the state budget.

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What they’re saying

“In Michigan, Medicaid is the foundation of our health care system. It's more than 1 in 4 Michiganders, more than a million children. We're talking about seniors, people with disabilities and pregnant women.”

— Jen Flood, Michigan State Budget Director (Detroit Free Press)

“We're going to be laser-focused on making sure that people maintain access to health care and that we're supporting providers across the state to the extent the state can play a role here in light of big federal changes.”

— Jen Flood, Michigan State Budget Director (Detroit Free Press)

“And then you see the emergency room increasing, people are much sicker when they get there, and then the hospitals are not getting compensated for the care with the uninsured, which puts pressure on their bottom line. Health care is paid for by somebody, whether or not that's the person accessing it. It will translate to higher costs for everyone else.”

— Elizabeth Hertel, Director, Michigan Department of Health and Human Services (Detroit Free Press)

What’s next

The governor's budget proposal will be presented to the Republican-controlled Michigan House and Democratic-held Senate, who will need to reach an agreement with the governor on the state's spending plan for the upcoming fiscal year.

The takeaway

Michigan's efforts to maintain Medicaid coverage and address rising health care costs highlight the challenges states face in ensuring affordable and accessible health care, particularly in the face of federal funding reductions and policy changes. The governor's budget proposal will be a key battleground for these issues in the coming year.