Alameda Alliance for Health, a county-organized Medicaid managed care plan serving more than 400,000 members in Alameda County, Calif., is bracing for a potential 40% to 45% reduction in membership over the next three years as federal Medicaid cuts and work requirements take effect.
CEO Matthew Woodruff, who has led the plan since 2023, told Becker’s the Alliance has completed a three-year financial projection and is already coordinating with county officials, safety net providers and its board of supervisors to prepare for the impact.
“There will be cuts, and those are unfortunate cuts, because these are people that we want to work with and it’s our goal to serve,” Mr. Woodruff said.
Mr. Woodruff attributed the projected losses primarily to work requirements and changes to coverage for noncitizens receiving Medi-Cal benefits. The reductions would roll in over fiscal years 2026 through 2028 rather than all at once.
H.R. 1 requires Medicaid enrollees ages 19 to 64 in expansion states to complete 80 hours per month of work, education, job training or community service to maintain eligibility, starting in 2027. The Congressional Budget Office has estimated the new requirements will lead to 5.3 million more people becoming uninsured through 2034.
Despite the looming membership decline, Mr. Woodruff said the Alliance is planning for long-term sustainability. The organization is evaluating potential entry into new lines of business, including C-SNP products, ACA marketplace plans and additional Medicare offerings.
“We’re already planning 2028, 2029 and 2030,” Mr. Woodruff said. “We’re doing a lot of work internally to make sure that the Alliance is here for another 30 years and to keep us financially stable throughout that entire process.”
The plan launched a D-SNP product at the start of this year, setting a first-year goal of 1,500 members and a three-year target of more than 12,000. Mr. Woodruff noted the Alliance already serves 50,000 dual-eligible individuals, giving it a large built-in population to convert over time.
“We did not go with the big bang,” he said. “We decided that we wanted to make sure that we’re in this for the long haul and that we’re doing this correctly.”
Mr. Woodruff described 2024 as a difficult year financially but said the plan has since stabilized, projecting roughly $20 million in profit by the end of its current fiscal year in June. The organization invests back nearly 100% of its approximately $2 billion in annual revenue to healthcare services, a function of its structure as a public, nonprofit health plan.
The Alliance has also invested nearly $38 million in housing, homelessness and food-as-medicine programs. Mr. Woodruff acknowledged that quantifying return on investment for social determinants spending remains difficult but said the Alliance views it as foundational to its mission, particularly for a vulnerable population in one of the country’s most expensive regions.
“If somebody knows where they’re going to place their head every night, if they’re getting a decent meal, then they can take care of their healthcare needs,” he said. “That’s the way we look at it.”
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