Trump Administration Ends Federal Medicaid Funding for Non-Healthcare Services

The Trump administration recently ended federal Medicaid funding for non-healthcare services like housekeeping, groceries, and internet access.

Traditionally, Medicaid is designed to provide health benefits to low-income populations, but over the last two decades, some states have used Medicaid waivers to fund social determinants of health programs, which include spending on housing, nutrition, and other non-medical services.

Such spending grew significantly, with state allocations tripling between 2019 and 2025 to $2.7 billion. The Biden administration expanded these waivers further, enabling states including New York, California, and North Carolina to use Medicaid funds for various non-healthcare services.

There is a financial incentive for states to increase Medicaid spending as federal matching funds are tied to state expenditures. Ending federal funding for these programs aims to preserve Medicaid resources by focusing on core healthcare needs amidst the growing national debt exceeding $36 trillion. This move also highlights concerns about fiscal responsibility and the appropriate scope of Medicaid funding.