Idaho budget committee introduces new health and welfare budget with additional cuts

The Idaho Legislature’s budget committee introduced a new health and human services budget Thursday that includes $21 million in additional budget cuts to Medicaid disability services.

The new budget replaces Senate Bill 1375, the original fiscal year 2027 health and human services maintenance of operations budget, which the Idaho Senate killed on March 12. Senators killed the original budget following an impassioned debate from Sen. Jim Guthrie, R-McCammon.

The new health and human services budget introduced Thursday includes one change from the original budget the Senate killed. The new budget reduces funding by an additional $21 million in connection with House Bill 863. House Bill 863 is a separate bill that would cut provider rates for residential habilitation programs. That bill advanced out of the Senate Health and Welfare Committee on Wednesday, the Idaho Capital Sun previously reported.

Reducing funding for the services will cause the state to miss out on an additional $44 million in federal funds, according to state budget documents. That brings the total cost of the funding reduction to $65 million, after the lost federal funds are calculated.

The fiscal year 2027 health and human services maintenance budget includes funding for the Idaho Department of Health and Welfare and the Independent Living Council.

Idaho Republicans, governor have pushed for state budget cuts throughout 2026 session

Budget cuts have been the defining – and some of the most controversial – elements of the 2026 legislative session. Gov. Brad Little and the Idaho Legislature are cutting budgets for most state agencies and programs by 4% in the current fiscal year 2026 and 5% in fiscal year 2027. Budget cuts are necessary, officials say, in order to pay to conform with federal tax cuts endorsed by President Donald Trump in the One Big Beautiful Bill Act, and due to ongoing revenue uncertainty.

Legislators appear to generally agree that the state needs to do something to avoid an unconstitutional budget deficit, but they disagree over how to do it.

Rep. Josh Tanner and Sen. Scott Grow, both Republicans from Eagle, have overseen a budget process that essentially took the 3% budget cuts Little approved last summer and added an additional 1% cut in fiscal year 2026 and an additional 2% cut in fiscal year 2027.

Some legislators from both parties have pushed back, arguing that the process leading to the cuts has not been transparent and the additional cuts pose a risk to core government services and programs.

Meanwhile, some Democrats have instead advocated for delaying the implantation of state tax cuts and are calling for dipping into state rainy day reserve accounts to stabilize the budget and avoid a shortfall.

Finally, some conservative Republicans have called for even deeper budget cuts.

Will Idaho Senate accept rewritten budget with additional cuts?

It was not immediately clear Thursday how the Idaho Senate would respond to the rewritten budget.

In his March 12 debate, Guthrie called the across-the-board budget cuts applied to most state agencies and departments “a defining moment” for legislators and challenged the Idaho Legislature to do better. Guthrie also said the budget crunch that has dominated the 2026 legislative session was self-inflicted as a result of tax cuts and spending decisions the Idaho Legislature made in previous legislative sessions.

On Thursday, Senate Minority Leader Melissa Wintrow, D-Boise, said she still isn’t happy with the new budget. Wintrow and Democrats have been pushing to restore funding for peer support services and Assertive Community Treatment, or ACT, services.

“I still am very disappointed in this motion because I see a really hard cut for (residential habilitation),” Wintrow said. “I think it’s too hard.”

The new budget will be given a bill number and publicly posted to the Idaho Legislature’s website after it is read across the desk on the floor of either the Idaho Senate or Idaho House of Representatives.

Routine policy bills are often read across the desk and publicly posted the same day that they are introduced by a committee, or the day after. However, budget bills often take longer to draft and post.