With growing fiscal pressures and new legislative proposals on the table, Medicaid Plans are facing unprecedented demands to operate more efficiently—without compromising member outcomes or burning out their teams.
Recent proposals from the House and the administration signal a shift toward deeper Medicaid reform, tighter federal spending, and increased state accountability. The question for many health plans is clear:
How do we keep moving forward without breaking the system—or our staff?
At InfoMC, we’re working with plans to help answer that question. This blog outlines the most recent developments and what health plans can do now to adapt, streamline, and lead through uncertainty.
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What’s Changing: The Policy Landscape
As of June 2025, several federal proposals are poised to reshape Medicaid operations. Among them:
- Work Requirements
Mandating that able-bodied adults under 65 complete 80 hours per month of work, education, or community service to qualify for Medicaid. This change is expected to result in approximately 5.2 million individuals losing coverage.
(Time)
- Reduction in Federal Matching Rates
Decreasing the federal match for Medicaid expansion populations from 90% to 80%, shifting more financial responsibility to states.
(KFF)
- Repeal of Simplified Eligibility Processes
Rolling back streamlined eligibility and renewal rules may lead to increased administrative burden and potential loss of coverage for eligible enrollees.
(Georgetown CCF)
- Increased Administrative Burden
As funding responsibilities shift to states and eligibility redeterminations become more complex, health plans are tasked with managing a heavier workload—often with fewer internal resources. Teams must maintain compliance, complete more member outreach, and handle higher volumes of appeals and redeterminations.
Indirect Pressures: HHS Budget Cuts and Organizational Shifts
While direct Medicaid funding remains largely intact, the administration’s proposed 25% cut to HHS discretionary spending includes a $674 million reduction to CMS program management and major cuts to public health agencies. These proposals also include:
- Consolidating agencies such as SAMHSA, HRSA, and parts of the CDC into a single entity, the Administration for a Healthy America
- Cutting funding to programs like cancer research and HIV prevention
These structural and budgetary changes may disrupt oversight, delay support, and place added strain on Medicaid plans that rely on inter-agency collaboration. The result? Plans will need to absorb more operational responsibility while external support decreases.
(Fierce Healthcare)
What Health Plans Can Do Now
To remain resilient and compliant in this evolving environment, Medicaid plans must focus on operational efficiency, flexibility, and technology-driven care management. Here are five proven strategies:
- Automate Administrative Workflows
Reduce overhead and delays by automating intake, authorizations, referrals, and task assignment—freeing staff to focus on high-impact activities.
- Streamline Care and UM Processes
Use configurable workflows that eliminate redundant steps and enable faster, more consistent decision-making.
- Enhance Interoperability
Break down data silos by integrating platforms via FHIR APIs and real-time data exchange. This supports better member tracking, transitions of care, and coordination with providers and social service agencies.
- Align with Value-Based Models
Leverage analytics to identify high-risk members and align payment with outcomes. This ensures resources are directed to where they will have the most impact.
- Track Compliance Proactively
Real-time dashboards and audit-ready documentation can help plans avoid penalties and meet tightening federal and state oversight requirements.
Conclusion
Proposed Medicaid funding cuts present serious challenges—but they also create a moment for health plans to rethink how they operate. As budgets tighten and administrative demands increase, success will depend on the ability to streamline processes, improve care management, and align resources with the highest-need members.
Doing more with less isn’t just a mandate—it’s an opportunity to modernize.
InfoMC’s Incedo™ platform helps Medicaid health plans meet this moment by providing a powerful, integrated solution that unifies care management, utilization management, and regulatory compliance. By automating routine tasks, streamlining workflows, and enabling real-time data exchange, Incedo helps organizations reduce administrative burden, increase visibility into member needs, and ensure timely, coordinated care delivery—even with limited resources. With built-in tools to track compliance metrics, manage risk, and support value-based care models, Incedo equips Medicaid plans to operate more efficiently, stay audit-ready, and deliver better outcomes—while doing more with less.
Note: This blog post is based on information available as of June 3, 2025. Health plans should consult the latest federal and state guidelines to ensure compliance with current regulations.
