Legislative update - June 4, 2025

After blowing past several self-imposed deadlines, the much-anticipated special session before a partial government shutdown is still elusive despite most budget bills being resolved. In addition to significant policy questions, specifically around whether the removal of undocumented adults from MinnesotaCare will travel separately from the Health bill and an 11th-hour attempt by the Minnesota business community to water down the ban on restrictive covenants in employment contracts, the Tax bill is still not near agreement. Legislative and executive leadership posted a signed, slimmed-down version, but Senate DFL tax committee members signaled opposition. Meanwhile, legislative leadership is attempting to work around Gov. Walz's travel schedule and nearing the trial date for Sen. Nicole Mitchell on June 15th. It is unlikely that a special session will happen before Saturday, and if a miracle does happen, it will likely not conclude in one day.  

Other updates 

The U.S. Senate likely has set an ambitious timeline to pass the tax and spending bill off the floor and have it signed into law before July 4. If it passes the Senate, this will have devasting consequences for Minnesota, as items for consideration have numerous cancellations of climate resiliency standards and grants and significant Medicaid restructures. Proposals on Medicaid cuts include: 

• Implementing work requirements  

• More frequent eligibility checks for both recipients and providers 

• Moratorium on rule change for Basic Health Plan, CHIP, and Medicaid enrollment  

• Reducing Federal Medical Assistance Percentage (FMAP) by 10% for states that provide any medical coverage to undocumented individuals 

• Cutting retroactive coverage from three months to one  

• Requiring co-payments for individuals covered under expanded coverage above the federal poverty level 

• Prohibiting Medicaid payments to be paid to nonprofit providers, essential community providers and their affiliates primarily engaged in family planning services, reproductive services, or provide abortion services not currently exempted under the Hyde Amendment  

• Blocking any state from increasing the provider tax 

• Disqualifying gender care and transition services from Medicaid and the Affordable Care Act 

The proposal in total would cut Medicaid spending by $715 billion over ten years and result in more than 10 million people losing their health insurance coverage by 2034. Medicaid is the largest provider of health insurance for Minnesotans, covering roughly 20 percent of the population, totaling $300 million cut for Minnesota. Proposed increase to states’ cost-sharing percentages for SNAP benefits could cost Minnesota more than $200 million annually.