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Over the next six years, Oregon could lose roughly $12 billion in federal health insurance funding and an additional $2 billion-plus in food benefits as a result of the massive budget bill that President Donald Trump signed into law last month, according to a state analysis released Monday.
The cuts, which overwhelmingly target social safety net programs for the poor, will hit gradually, the analysis said, escalating sharply as new rules kick in around 2027.
The biggest projected cuts are to the Oregon Health Plan, the state’s Medicaid program, which is sustained largely on the basis of federal dollars.
As a result of the new federal law, the plan will see a $490 million drop in federal funding in the 2025-27 budget cycle, the analysis said. This, it estimated, will give way to a $4.3 billion federal funding drop in the 2027-29 budget cycle, and a $6.8 billion drop in the 2029-31 cycle.
For context, Oregon planned for about $20 billion in federal Medicaid funds for its 2023-2025 budget cycle.
“The Trump Administration and Republicans in Congress have betrayed American children and families, who will become sicker, hungrier, and less prosperous because of President Trump’s budget bill,” said Gov. Tina Kotek in a written statement accompanying the report. “Oregonians will see less of their federal tax dollars coming back to our state for things they count on. Furthermore, President Trump and Congress knew that state governments cannot pay for this substantial gap in services but went ahead and did it anyway.”
As of June 2025, one in three Oregonians—and three in five Oregonians under 18—were enrolled in the Oregon Health Plan, according to state health authority data.
According to the state analysis, the Trump law is likely to result in a “significant decline in plan members accessing benefits.” One reason is that it will make it harder for many people to get, or keep, their Medicaid health insurance. And this in turn means less federal funding coming into the state.
Under the law, for example, the Oregon Health Authority will, beginning in 2027, need to ensure able-bodied adults receiving Medicaid benefits meet federal work requirements. The state projects that the effects of this alone will result in $344 million in lost federal revenue in the 2025-27 budget cycle, $2.2 billion in the 2027-29 cycle and $2.3 billion in the 2029-31 cycle.
Over the same period, the state estimates it will lose another $1 billion-plus as a result of a new requirement, also set to begin in 2027, to verify the eligibility of many Medicaid members every six months. The state says it will lose an additional $2 billion in the coming budget cycles as a result of new caps on “provider taxes,” a tactic it uses to get more federal Medicaid dollars.
These estimates do not include costs of the “extensive administration infrastructure” the state says it will need to develop to comply with the new federal law.
The Trump budget bill will also cut federal funding for SNAP, which helps poor people pay for food, with Oregon potentially being asked to pay a far greater percentage of overall program costs. Still, the analysis said much of this expense could be mitigated if the state can significantly reduce the rate of errors it makes when determining people’s eligibility and benefits.
