Montana’s Health Policy Shake-Up: Medicaid Rates, Abortion Laws, and a Lawmaker Expelled

Last updated: October 12, 2026

Montana's recent legislative session was supposed to be about a $2.5 billion state surplus and a long-delayed correction to Medicaid provider rates. Instead, the expulsion of a transgender lawmaker from the House floor took most of the oxygen. Beneath the political theater, lawmakers passed significant health policy: a major Medicaid reimbursement increase for behavioral health and nursing homes, ten abortion-restriction bills, and measures affecting transgender rights.

Here's what got passed, what it means, and what to watch.

At a glance

• Democrat Zooey Zephyr was removed from the House floor during debate on a gender-affirming care bill, drawing national attention.
• Lawmakers increased Medicaid provider reimbursement rates after years of cuts that providers said didn't cover the cost of care.
• Governor Greg Gianforte signed five of ten abortion-restriction bills into law.
• Eleven Montana nursing homes closed last year, citing low Medicaid rates as the main reason.

The Medicaid story

Mary Windecker, executive director of the Behavioral Health Alliance of Montana, called the reimbursement increases unprecedented. Lawmakers entered the session with a $2.5 billion budget surplus, a sharp contrast with 2017, when nearly $50 million was cut from the Department of Public Health and Human Services budget. Those cuts had long-term consequences.

The new budget funds a legislatively mandated study of Medicaid provider reimbursement in behavioral health, long-term care, and developmental disability services. Lawmakers heard hours of testimony that current rates don't cover the average cost of services.

For nursing homes, rates rose from $209 per patient per day to $262 in the first year of the new budget and $278.75 in the second year, per Rose Hughes of the Montana Health Care Association.

The abortion bills

Gianforte signed five of ten abortion-restriction bills into law. Senate Bill 154 removes abortion rights from the state constitution's privacy clause, which had been the legal basis for protecting abortion access after the Supreme Court overturned Roe v. Wade. House Bill 625 creates a "born alive" requirement, mandating care for infants born alive after an attempted abortion and creating fines and up to five years in prison for noncompliance. Another bill adds prior authorization and documentation requirements for Medicaid or CHIP-covered abortions.

The state had been one of 20 states plus D.C. That advocates considered protective of abortion rights. The new laws are expected to face legal challenges.

Who should care

Rural nursing home families:** The rate increases are real money aimed at facilities that were closing. Whether they prevent future closures depends on implementation and whether staffing problems can be solved.

Behavioral health providers:** Direct revenue impact from the rate increases. The gap between current rates and cost of care is smaller, but full effect depends on Department of Health implementation.

Low-income women seeking abortions:** More restrictions, more documentation requirements, and a legal landscape in flux. Access depends heavily on how court challenges resolve.

Transgender Montanans, especially youth:** A slate of new restrictions on gender-affirming care and documentation requirements.

What to watch next

Watch how the Montana Department of Health implements the new provider rates, and whether the increases translate into more service capacity. Watch the legal challenges to the abortion bills, especially SB 154. And watch whether the Zephyr expulsion has a longer-term effect on legislative dynamics around health policy.

Key takeaways

• Montana's session delivered long-delayed Medicaid reimbursement increases alongside new abortion restrictions.
• The reimbursement increases are real but don't fully close the funding gap.
• The session's political drama overshadowed the substantive health policy work.