Funding Freeze Announcement Causes Chaos for Health Centers

Jan. 29, 2025
Several states reported being blocked from accessing the Medicaid payment portal

January 28's funding freeze from the U.S. Office of Management and Budget (OMB) caused chaos for several states and community health centers attempting to access Medicaid portals and payment disbursement systems.

White House spokesperson Karoline Leavitt shared in a social media post that the White House was aware of the Medicaid program's online portal outage and said it would be back online soon. She added that no payments had been affected.

Healthcare Innovation spoke to Kristin Wikelius, chief program officer at the non-partisan nonprofit organization United States of Care (USofCare), on Tuesday afternoon, as confusion over the order was widespread.

A funding freeze like this brings chaos and uncertainty, Wikelius says. "When it comes to individual people, they fear losing healthcare coverage and access to care that they really rely on." "One of the most important things, and this is true across demographics, is having coverage that's dependable when your life changes."

"A change in federal funding policy," Wikelius adds, "makes people question if their Medicaid will be there for them tomorrow, or the children's health insurance coverage that their child relies on."

Furthermore, Wikelius points out there's been a lot of confusion around what was happening with the portals and if that was connected to this potential funding freeze.

Meanwhile, a judge put a hold on the funding freeze, Healthcare Innovation's Mark Hagland reported on Tuesday evening, quoting The Associated Press's Chris Megerian and Lindsay Whitehurst: "A federal judge on Tuesday temporarily blocked a push from President Donald Trump to pause federal funding while his administration conducts an across-the-board ideological review to uproot progressive initiatives."

Also on Tuesday evening, the Washington Post's Tony Room, Jeff Stein, Jacob Bogage, and Emily Davies reported that "The order prevented the new restrictions from taking effect until at least Feb. 3, buying time for a coalition of public health advocates, nonprofits and businesses — represented by the left-leaning group Democracy Forward — to proceed with a case that may test Trump's claims of expansive power over the nation's fiscal trajectory."

"Funding will continue to flow, at least for the following week," Wikelius remarks. "We'll be watching very carefully to see as this plays out in court and what the administration chooses to do." During this pause, Wikelius hopes the administration can reconsider the need for a freeze.

"Today, people had to spend their time trying to understand what this meant, if funds would flow for them tomorrow, if they'd be able to open their doors," Wikelius says, addressing the current state of chaos. "That takes away from care that they're providing to people."

A broad list of grant programs across the government are potentially impacted, Wikelius answers to the question of how widespread the funding freeze would be. "The impact on people across the country is potentially very wide-ranging."

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