Oregon faces $1.3 billion Medicaid shortfall as 2025 federal tax law takes effect
State officials say the 2025 GOP tax and spending law will force Oregon to find nearly $1.3 billion over four years to keep Medicaid operating, putting many enrollees at risk of losing coverage.
During a Senate Health Care Committee hearing, Oregon Health Authority interim director Fariborz Pakseresht and senior officials warned that the 2025 GOP federal tax and spending legislation will require the state to raise nearly $1.3 billion over the next four years to sustain its Medicaid system. The agencies project a $421 million shortfall for one outlet two-year budget and an $868 million gap for the subsequent period, driven by a $1 trillion federal cut, new work-hour mandates and semi-annual eligibility reviews.
About 200,000 residents could lose coverage, and 600,000 adults will be notified of the 80-hour monthly work, volunteer or education requirement. The state has already allocated $110 million for additional staffing and is improving digital tools for document verification. Immigrants previously eligible for Medicaid and SNAP will be moved to the state-run Healthier Oregon program, which will fund their care using state resources. Lawmakers offered little detail on how to bridge the budget holes, while Democratic senators criticized the federal approach as a strategy to force cuts through administrative burdens.
