Mental Health America urges Congress to protect Medicaid

Families struggling with mental health and addiction need help, not hurdles that take away their coverage and care.

Alexandria, VA (May 13, 2025) – Mental Health America (MHA) strongly opposes the recent Medicaid proposals of the House Energy and Commerce Committee’s Budget Reconciliation bill, warning it will add unnecessary red tape and more out-of-pocket costs that hurt children and people struggling with mental health and addiction. 

Key concerns with proposed reconciliation bill

Increased barriers to coverage

Studies show that losing Medicaid coverage leads to significant reductions in access to critical mental health and substance use services. The bill will cut billions of dollars from Medicaid in part by adding burdensome reporting requirements for proving eligibility, addresses and employment, and by delaying rules that made it easier to qualify for Medicaid coverage. The non-partisan Congressional Budget Office estimates that provisions in the bill will lead to millions of Americans losing their healthcare.

Disproportionate harm to individuals with mental health needs

A recent study found that people who lost Medicaid coverage for procedural reasons during the post-COVID unwinding process had greater mental health needs, including higher levels of depression, anxiety and frequent worry, than those who lost coverage for other reasons.

Loss of coverage from faulty technology and state administrative errors

People with significant mental health needs, especially those who change addresses frequently or are experiencing homelessness, may not be able to navigate error-prone and difficult to use websites, and some jobs do not provide the newly-required documentation. The bill lacks a clear definition for a “disabling mental disorder,” which is an exemption to the work requirements, and fails to explain the process to qualify for exemptions.

Harm to children’s health

The proposal to delay the recent rule streamlining eligibility and enrollment for Medicaid and the Children’s Health Insurance Program will postpone changes that help children and families obtain and maintain coverage. In contrast, a review of Texas’s implementation of twice-yearly Medicaid eligibility determinations showed that thousands of children lost coverage for procedural reasons. This contributed to the state having one of the highest rates of uninsured children.

Threats to community mental health infrastructure

Pre-COVID studies showed a steep decline in individuals’ outpatient mental health care after becoming uninsured due to losing Medicaid. The proposed bill increases cost-sharing for mental health and substance use services for some Medicaid recipients, causing people to forego or reduce care. These changes will impact vulnerable health providers, including rural hospitals, community health centers, and community mental health centers.  Hospitals are already struggling financially to keep their psychiatric beds open, and they disproportionately rely on Medicaid funding. For example, one Iowa hospital noted that 40% of its mental health patients are on Medicaid compared to 12% of other patients.

A call for support, not hurdles

Taking away Medicaid coverage has a devastating impact on access to mental health care and substance use treatment for both individuals and communities where providers rely on Medicaid funding. 

“The proposed Medicaid cuts are a misguided direction and risk doing greater harm during a mental health and addiction crisis in our country,” said Schroeder Stribling, President and CEO of Mental Health America. “Congress should ensure that Medicaid provides better behavioral health care to more people. Adults and children struggling with mental health and addiction need help, not hurdles that take away their coverage and their care.”  

Mental Health America is the nation’s leading community-driven nonprofit dedicated to promotion of mental health, well-being, and prevention. Mental Health America’s work is driven by its commitment to promote mental health as a critical part of whole person health, including prevention services for all; early identification and intervention for those at risk; and integrated care, services and supports for those who need them. Learn more at MHAnational.org.

Media contact: media@mhanational.org