Kentucky Medicaid: Setting the Record Straight (Representative Jason Nemes, House District 33)

You may have recently seen news that Governor Beshear sent a letter to Medicaid providers announcing cuts and encouraging people to contact their legislators. I want to address that directly, because you deserve the full picture, not just one side of it.

The growth is real, and it is not sustainable.

Since the Affordable Care Act took effect in 2014, Kentucky’s Medicaid spending per resident has grown by 186%, second highest in the entire nation. (See the attached graphic.) Let that sink in. Meanwhile, Kentucky’s enrollment exploded from roughly 607,000 people in 2013 to 1.6 million today. That is 168% growth, the largest in the country. Today, 1 in 3 Kentuckians is on Medicaid. Medicaid is now Kentucky’s second-largest budget item, behind only education.

I want to be clear: I am not saying this program does not matter. It absolutely does. Medicaid protects vulnerable children, elderly Kentuckians in nursing homes, and people with disabilities who have no other options. The program is worth fighting for. That is exactly why we cannot let it collapse under its own weight.

Here is what the General Assembly actually did.

Rather than walking away from Medicaid, the General Assembly took responsible action on multiple fronts:

First, we increased Medicaid funding in the new biennial budget, and we did so significantly. The new budget dedicates $6.1 billion in General Fund dollars to Medicaid, with a total of $7.9 billion from all fund sources.

Second, we put $290 million in the Budget Reserve Trust Fund as a backstop. If the Governor believes additional funds are needed, he can make that case to the legislature and request access to those funds. We did not think it would be necessary, but we planned ahead just in case.

Third, enrollment is already declining, and the Governor’s own numbers tell the story. His budget projected 1,465,000 Medicaid enrollees in FY 2026. Actual enrollment as of May 2026 is 1,350,000 and still falling. That gap represents $2.17 billion the Governor failed to account for. Part of the reason enrollment is declining is encouraging: every one of Kentucky’s 120 counties saw its unemployment rate fall in 2025. When people find work, they move off Medicaid. That is the system working as it should.

Fourth, House Bill 2 requires working-age, able-bodied adults in the Medicaid expansion population to demonstrate community engagement, such as work, job training, education, or volunteering. This is currently being implemented. And for those worried about the traditional Medicaid population, the elderly, the disabled, and children, they are fully protected. HB 2 does not touch them.

Fifth, we gave the Governor more flexibility, not less. HB 2 expanded his authority to manage the program, discontinue programs that are no longer effective, and redirect those savings to cover other needs as he sees fit. On top of that, the budget we passed directed the administration, for the first time in modern history, to identify spending that is duplicative, outdated, or no longer effectively serving Kentuckians. The General Assembly gave the Governor significant tools and significant trust, and he has already begun using that expanded flexibility within the past month.

Sixth, the General Assembly has also given the Governor the tools to clean up waste and fraud in the program. State Auditor Allison Ball has uncovered over $800 million in Medicaid payments made erroneously without benefiting Medicaid recipients, and her office has identified over $1 billion in total waste, fraud, and abuse within Kentucky’s executive branch. These include the Department for Medicaid Services failing to ensure ineligible noncitizens did not receive benefits, failing to prevent duplicate Social Security numbers from being used by multiple claimants, and failing to complete inspections of over 100 long-term care facilities. HB 2 includes stronger program integrity tools specifically designed to address these failures. The Governor has the authority and the resources to recover these dollars. Doing so would go a long way toward addressing any genuine fiscal pressure.

So why is the Governor making these cuts?

That is a fair question, and I want to be honest with you: I do not know. What I do know is that they are not fiscally necessary. The Governor has already demonstrated this session that he can find money when something is a priority to him. He moved funds to address a separate round of cuts he announced in early June, and he found funding for a pilot program that failed to pass through the legislative process. The money can be found when the will is there.

Furthermore, any actual cut to Medicaid benefits would require the Governor to notify the federal Centers for Medicare and Medicaid Services. There is no evidence that any such request has been made. That means what is happening right now is not a cut to Medicaid benefits. It is a set of administrative and provider-level decisions that the Governor is choosing to make, and choosing to announce in a way that points fingers at the legislature.

I will leave it to you to draw your own conclusions about why these particular decisions are being made in this particular way. What I can tell you is that the legislature funded this program generously, gave the Governor the tools to manage it wisely, and set aside a reserve in case more is needed. The decisions being made right now belong to the executive branch.

The goal is a stronger Medicaid, not a smaller one.

Hardworking Kentucky taxpayers cannot sustain the explosive, unchecked growth of the last decade. Medicaid is crowding out our ability to fund schools, roads, public safety, and other programs that serve every Kentuckian. Reforms are not only responsible, they are necessary.

The people who truly depend on Medicaid, the elderly, the disabled, children in need, are protected. Working-age adults who are able to work are being encouraged to do so. And the Governor now has more tools than ever to run this program effectively.

That is the record. Judge it accordingly.