What To Know About How Trump’s Funding Freeze Screwed Up Medicaid Portals In All 50 States

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In the wake of mass chaos and reports of Medicaid payment portals being shut down in states across the U.S., a federal judge on Tuesday evening temporarily paused a portion of the Trump administration directive to halt the disbursement of federal loans and grants.

U.S. District Judge Loren AliKhan ordered the Trump administration to not block any federal funds that were already locked in to be disbursed until Feb. 3, temporarily maintaining the status quo while the constitutionality of the Trump move is assessed in court.

After OMB Acting Director Matthew Vaeth issued the memo that sparked panic and confusion Monday announcing a supposed “temporary pause” on federal grants, loans and other financial assistance programs — a move that my colleague Josh Marshall and others have described as creating a wide-ranging constitutional crisis and a “unilateral government shutdown on steroids” — the OMB was forced to issue another directive by midday Tuesday claiming it had been misunderstood.

In the Tuesday memo, the OMB claimed that the 90-day pause, which was set to take effect 5:00 p.m. ET Tuesday, was meant to give agencies a window to bring federal spending in line with directives in Trump’s recent spate of executive orders, like those that gutted U.S. foreign aid programs and Trump’s sweeping agenda targeting anti-discrimination programs.

In the Tuesday memo, the OMB said that certain programs like Medicaid, food stamps, small business assistance, rental assistance and preschool programs like Head Start would be excluded from the funding freeze, as Trump seemingly attempts to swipe budget authority from Congress.

But that’s not exactly what happened. Reports surfaced from states around the country Tuesday afternoon that payment portals for Medicaid funding had already been shut down in certain states. Illinois Gov. JB Pritzker’s office was one of the first to announce that his state had been shut out of the program.

Reporters repeatedly pressed White House press secretary Karoline Leavitt about the reports Tuesday afternoon during a press briefing. She told reporters, “I’ll check back on that and get back to you,” prompting alarm and outrage from Democratic members of Congress.

Multiple Democratic senators began reporting on social media that Medicaid payment portals had been shut down in their states. Sen. Ron Wyden’s (D-OR) office confirmed the shutdown was country-wide.

“My staff has confirmed reports that Medicaid portals are down in all 50 states following last night’s federal funding freeze,” he wrote. “This is a blatant attempt to rip away health insurance from millions of Americans overnight and will get people killed.”

It wasn’t just the Medicaid portal. Officials in states across the country experienced issues Tuesday accessing rental assistance funds and federal reimbursements for Head Start. Per WaPo:

Many states reported issues accessing funds under the Medicaid low-income health insurance program, for example, which was never supposed to be affected by the White House spending halt. Preschool centers struggled to obtain reimbursements under the federal program known as Head Start, putting some child care services at risk.

A web portal that housing providers use to draw down money for government voucher and rental assistance funds stopped working Tuesday, though the cause was not immediately clear. And federal health and education officials similarly said they had to halt work amid the mixed messages from the White House. That delayed money for some after-school programs, charter schools and the Special Olympics, a spokesperson for the Education Department confirmed.

As of 5:00 p.m. ET Tuesday it was still not yet clear whether cutting off states’ access to the Medicaid funding portal was an intentional part of Trump’s plan, alongside the other attempts at unparalleled executive overreach. Initial reports suggested that the OMB freeze applied to everything except salaries for federal employees, checks to Social Security and Medicare beneficiaries and members of the military. But Republicans in Congress have spent months flirting with the notion that gutting budget allocations for Medicaid and food stamps is very much on the table.

Leavitt tweeted later Tuesday afternoon that the portal would be back online soon.

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