Proposed federal budget cuts to Medicaid would further strain the county’s health system

Editor’s note: This story was corrected on June 5 at 4 p.m to clarify a quote by Congressman Steve Cohen.

When Shelby County Director for Health Services Dr. Michelle Taylor walks through Regional One Health’s emergency room, she sees the seams fraying from the strain of Memphis’ public health infrastructure — and it’s troubling. Nearly one in three patients has no insurance and, if the federal budget bill now before the Senate becomes law, that number could climb dramatically higher. 

“If these federal cuts were to pass, it would enlarge [the Medicaid coverage] gap almost certainly,” Taylor said, noting that 90,000 people in Tennessee fall into the Medicaid coverage gap, and 70,000 of those live in Shelby County.

In addition to reducing Medicaid coverage, the House-passed 2025 federal budget includes sweeping tax cuts for high-income earners and corporations — amounting to what critics have called one of the largest wealth transfers in recent history without offering any direct financial relief or expanded support for low-income Americans while imposing new burdens on safety net programs like nutrition assistance. A letter from public health and public policy researchers at the Yale School of Public Health to Senate leaders warned that the bill could lead to the death of 42,500 Americans annually due to Medicaid disenrollment, loss of ACA Marketplace coverage and the elimination of nursing home staffing rules.

“This is the most disastrous budget bill in history,” said Congressman Steve Cohen, who represents Tennessee’s 9th District.

Proposed eligibility requirements for Medicaid most significantly, and specifically, impact immigrants.  It denies existing eligibility to “legally present” immigrants, now requiring that they have permanent status, which excludes those in Temporary Protected Status, the Deferred Action for Childhood Arrivals program and non-immigrant visa holders such as students, refugees and asylees, and more. 

This is part of a larger stated campaign by the Trump administration to increase detention of immigrants, the machine of which has recently ramped up in Memphis.

Since May 15, Community Legal Center’s Immigrant Justice Program Director Colton Bane has started escorting his clients throughout the courts, as outside the courthouse, a white van with Mississippi plates waits to intercept Memphians leaving proceedings and plain clothes officers patrol the lobby.

“They’re trying to circumvent essential due process in order to, like, more quickly deport people,” Bane said. He has seen a chilling effect on his clients’ willingness to show up for legal services appointments, and he is reticent to advise his clients to participate in government programs and processes. Bane fears that immigrants who are already resistant to seeking medical care will also become less likely to seek care or will seek care without coverage, putting the financial burden on hospitals and taxpayers.

“In the United States overall, approximately 8% of the population is not insured, but here in Shelby County in 2022, about 12% of our population was uninsured,” Taylor said. “That translates to more than 100,000 people… by far the highest percentage of any county in Tennessee.”

Shelby County’s public health safety net is already under strain. “We’ve already lost about $2 million in funding from various sources across the federal government, across state government,” Taylor said. “So when people lose their own tracks… one of the few places that they would be able to call to get some preventive services through public health — that’s getting cut too. ”

Taylor’s concern comes at a transitional moment: She recently announced that she will leave her post as director of the Shelby County Health Department this summer to take a new position in Baltimore. Her departure adds another layer of uncertainty to a public health system already facing instability.

“Everybody should be concerned that we are gonna have neighbors who are going to lose their health insurance because it is going to affect everyone,” Taylor said, giving the example of measles, which has spread rapidly to more than 1,000 Americans this year as vaccination rates have lowered, leading to the deaths of two children in West Texas.

She also warned that cutting coverage could undo years of work in Memphis’ fight against HIV. “We’re second in the nation in terms of HIV infections,” Taylor said. “When we lose funding for public health and access to care, people don’t get tested, they don’t get treated, and the virus spreads. That’s what we’ve been trying to prevent for years.”

Cohen warned that the legislation’s effects would fall especially hard on Tennessee, where the state never expanded Medicaid. “This would increase this, especially for certain immigrant groups and other groups that have been targeted specifically by the language of the bill,” he said.

That includes DACA recipients, who are likely to face heightened barriers to coverage under the proposed changes. According to U.S. Citizenship and Immigration Services, there were about 1,640 active DACA recipients in the Memphis metropolitan area as of March 2023.

Though that’s slightly below the national average as a percentage of the population, it remains a significant figure for a Southern state like Tennessee, where immigrant communities are smaller and state-level support structures are more limited. Many DACA recipients work in essential fields such as health care, education and logistics — core sectors in Memphis’ economy.

These individuals, most of whom have lived in the U.S. since childhood, already face restricted access to federal health benefits and could see those barriers harden further under the bill.

Cohen criticized House Republicans for preserving the 2017 tax cuts benefiting high earners while slashing Medicaid and other essential programs. “If they would continue to tax people with $400,000 a year and more income, they could save over $200 billion toward the deficit, but that wasn’t important enough to not give tax breaks to people who have much more.” He added that the bill “increases the deficit” while doing “nothing at all” to help the people who need it most.

Republican Congressman David Kustoff and State Sen. Brent Taylor were contacted to provide their party’s rationale for these cuts, but declined to be interviewed, with Brent Taylor comparing MLK50’s relationship to news as “what cow pies are to pies.”

While the Senate may amend the bill or reject it entirely, local leaders say the threat alone is destabilizing.

“This is a horrendous moment,” Cohen said. “To see the lack of concern and then the rationality they use and claim that they’re doing something… it’s just when people make it work, they’re going to get these benefits, all that kind of stuff. They’re making people jump through new hoops, so they’re hoping they’ll give up and they won’t do it.”

As Shelby County braces for possible Medicaid cuts, Michelle Taylor, the health director,  said what’s at stake isn’t abstract.

“There are not enough places left,” she said. “Where do people go?”

J. Dylan Sandifer (they/she) is an essayist and journalist who writes about the impact of federal politics and policy on Memphis for MLK50. Dylan authors Nothing is Inevitable on Substack and contributes regularly to The New Republic.

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