White House blames "outage" for locking out Medicaid, Head Start, health centers from funding site
The White House blamed an "outage" for locking out a wide range of organizations and agencies on Tuesday from the online systems responsible for drawing down federal health dollars.
Multiple state Medicaid programs reported late Tuesday they have been able to resume accessing their payment systems after the nationwide lockout.
The interruption had sparked outcry from state governments, nonprofits and lawmakers in the wake of the Trump administration's move to freeze spending across the federal government. After legal challenges were filed against the funding freeze, a federal judge issued a stay temporarily halting the move until she can hear arguments in the case.
State Medicaid agencies, federally funded Head Start early education programs and community health centers had been among those cut off from access to the Payment Management Services web portal, or PMS, run by the Department of Health and Human Services, which handles billions of dollars of payments every year.
"We have confirmed no payments have been affected — they are still being processed and sent. We expect the portal will be back online shortly," White House press secretary Karoline Leavitt said in a post on X.
Confusion after Medicaid programs locked out
There was widespread confusion after Medicaid and other programs discovered they were locked out of the federal health payment system. Spokespeople for HHS and the Centers for Medicare and Medicaid Services have not responded to requests for comment, amid the ongoing communications "pause" imposed by the Trump administration at the department.
A spokesperson for the National Association of Medicaid Directors said they had also sought an explanation.
"My staff has confirmed reports that Medicaid portals are down in all 50 states following last night's federal funding freeze. This is a blatant attempt to rip away health care from millions of Americans overnight and will get people killed," Oregon Democratic Sen. Ron Wyden posted on X.
"Multiple states locked out of Medicaid portal," Sen. Brian Schatz, a Democrat from Hawaii tweeted. "This is a Trump shutdown, except this time it's unlawful."
Missouri Republican Sen. Josh Hawley said he was assured Medicaid would not be affected.
"What the White House has told us just now is that Medicaid is not, categorically not, covered by this," Hawley said. "In other words, there will be no interruption to Medicaid or Medicare or any grant that floats to individuals."
Joann Alker of the Georgetown University Center for Children and Families had called on the administration to issue a statement clarifying that Medicaid should not be affected after its initial memo ordering the spending freeze late Monday, warning it is a "major crisis" as states look to draw down funding for the month.
"Any pause in federal funding of Medicaid — the largest source of federal funding received by states — would be disastrous for states as they need to draw down federal funds to meet their financial obligations to the health care providers and health plans serving Medicaid and CHIP beneficiaries," Alker said.
Health centers warn of "irreversible" consequences
Even as the payment systems come back online, those who rely on the grants say they worry that new "delays" on payments imposed by the Trump administration could inflict permanent damage on stretched-thin health care systems.
The HHS website currently warns that due "to Executive Orders regarding potentially unallowable grant payments, PMS is taking additional measures to process payments. Reviews of applicable programs and payments will result in delays and/or rejections of payments."
In a statement ahead of the lockout, HHS announced it would be reevaluating "all programs, regulations, and guidance to ensure Federal taxpayer dollars are not being used to pay for or promote elective abortion" following a previous executive order.
"Even with the best of intentions, these types of funding freezes can do tremendous harm. And could be irreversible to some communities. What we're really talking about is a health center's ability to pay salaries," said Amanda Pears Kelly, CEO of the group Advocates for Community Health.
The group lobbies on behalf of community health centers, which are subsidized by the federal government to offer health care to low-income communities.
Pears Kelly said that health centers often rely on being able to request money every-other-week through the system, drawing down their grant to pay bills and make payroll for their staff. Without the money, she warned many health centers facing already slim margins could be forced to trim staff or close their doors.
"When the system's down, and there's no one to talk to to understand what they need to do, and then on top of that there's an uncertain time to the delay, it's paralyzing," said Pears Kelly.
In a statement, the National Family Planning and Reproductive Health Association warned that health centers could face "significant disruption" to operations even with a "temporary funding pause."
"For many patients, Title X-funded health centers serve as their sole source of health care. The Title X family planning program is already chronically underfunded, and this executive action risks destabilizing a health provider network that is already operating under immense strain," said Clare Coleman, president and CEO of the association.
School lunches, other programs worry about impact
The implications of the federal grant pause go beyond HHS, but the full effects are still unknown.
It's unclear whether the National School Lunch Program, which reimburses schools and school districts each month for the meals they serve children, will still receive funding through the U.S. Department of Agriculture if the freeze takes effect. The program feeds about 28 million American schoolchildren each month.
Diane Pratt-Heavner, director of media relations at the School Nutrition Association, said her organization is asking the USDA for more information.
"We're urging Congress to increase reimbursements for school meals given the financial crisis facing meal programs today, so certainly there's just no room in the budget for missed reimbursements," she said.
Meals on Wheels, a nonprofit organization that delivers about 250 million meals each year to more than 2 million seniors, receives federal grant funding. They're not sure what's next either.
"If in fact this order includes the Older Americans Act, this would presumably halt service to millions of vulnerable seniors who have no other means of purchasing or preparing meals," a Meals on Wheels spokesperson said. "And the lack of clarity and uncertainty right now is creating chaos for local Meals on Wheels providers not knowing for sure whether they should be serving meals today, which unfortunately means seniors will panic not knowing where their next meals will come from."
They added that since the program is already underfunded, local providers generally "don't have the ability to absorb a blow like this, especially if it persists for any extended period."
