As the governor and state lawmakers finalize the state’s budget, they’re keeping an eye on Washington, where Republicans are considering maneuvers that could hit Maryland to the tune of $1 billion.

The Republican-controlled Congress wants to extend and expand tax cuts, and that means slashing $880 billion worth of federal spending over the next decade to pay for it. House Republicans believe they can find hundreds of millions in Medicaid savings, but outside analysts say they can’t reach the goal they set without cutting coverage.

Senate President Bill Ferguson said Medicaid is among the programs in “the largest jeopardy” on Capitol Hill.

“These are billion-dollar questions that if they shift because of a tax cut for billionaires, we have to react,” said Ferguson, a Baltimore Democrat.

The potential of Medicaid cuts is “very concerning,” said Del. Joseline Peña-Melnyk, who chairs the House of Delegates Committee that oversees health issues.

Medicaid is a health insurance program for people with low incomes or disabilities that’s jointly funded by the federal and state governments. It’s a lifeline for about 1.7 million Marylanders, and a significant source of funding for hospitals, behavioral health providers and nursing homes in the state.

Two in five of those in Medicaid are children, according to an analysis by the Hilltop Institute at the University of Maryland, Baltimore County, and Medicaid pays for 60% of nursing home stays.

The state spends a total of $16 billion on Medicaid, with $9 billion from federal sources.

Republicans have signaled that they want to shift more of the funding burden onto the states, a move that would be financially devastating in Maryland.

In particular, they’ve focused on a portion of the Medicaid program that dates to 2014, when states could expand eligibility for Medicaid coverage under the Affordable Care Act — with the feds picking up 90% of the cost, instead of the typical 50-50 funding split. More than 370,000 people have gained coverage through Medicaid expansion.

If Congress shifts that 90-10 funding to 50-50, state analysts estimate that Maryland would lose out on nearly $1 billion of federal funding per year.

Another option under consideration would be capping how much money could be spent per patient. State analysts warn that under that type of change, federal funding could be cut “potentially by a significant amount,” but did not estimate a potential dollar amount.

Either way, officials say, the cuts have the potential to be harmful to both patients and the state’s bottom line. The state is unlikely to be able to make up the funding difference.

State health officials who oversee the Medicaid program are “actively monitoring what is transpiring at the federal level regarding any potential impact to Medicaid funding,” said Chase Cook, spokesman for the Maryland Department of Health.

Dr. Meena Seshamani, who was recently confirmed to be the next state health secretary, recently told lawmakers that with no crystal ball to know what exactly is coming from Washington, communication will be key.

“I think that the perspectives that all of you have from your constituents will be very important with whatever we end up having to navigate,” she said during a Senate confirmation hearing last month. “I think being able to work very quickly and closely with all stakeholders is key to agility.”

Seshamani said the state may need to make changes to Medicaid while working to “maintain access and quality” of health care. She didn’t offer what type of eligibility or coverage changes might be necessary.

As lawmakers prepare to take final votes on the state budget on Monday, they’ve inserted a provision that requires the governor to consult with lawmakers about the next course of action if federal funding is cut by $1 billion or more.

Some lawmakers have suggested that they may need to return to Annapolis later in the year for a special session to rework the budget if Congress cuts Medicaid or other funds.

Lawmakers are also working to pass a bill to create a state commission to keep tabs on federal changes to Medicaid and the Affordable Care Act. The commission will serve as the “eyes and ears” of lawmakers and recommend any changes that may need to be made, Peña-Melnyk said.

If Medicaid spending is both capped and Affordable Care Act expansion funds are cut, they would reduce federal spending by $1.7 trillion over a decade, leaving states to pick up the funding, a “challenging” prospect, according to an analysis by the Urban Institute.

The cuts won’t end with individual Americans losing coverage or benefits but “will cause a cascading negative impact on the entire health care system,” according to a letter to congressional leaders from the medical associations of all 50 states, including the Maryland medical association, or MedChi.

The loss of Medicaid funding, the groups said, could lead to some hospitals, doctors’ offices, clinics and nursing homes closing and health care workers losing their jobs. Other patients would have to pay more, and everyone would have less access to care. States would be forced to choose between cutting services or raising taxes.

In urging the lawmakers to avoid the cuts, the groups said the burden would also fall on physicians, emergency rooms, hospitals and all other patients. Rural communities would be hit first and hardest because they tend to have a higher number of Medicaid patients. In Maryland hospitals overall, about 20% of patient revenue comes from Medicaid.

If Maryland can’t make up the funding difference, it would cause ripples across the state at a time when Maryland Medicaid is already strained by budget pressures and system troubles.

Medicaid covers a disproportionate amount of mental health and addiction services and births.

Hospitals could lose significant revenue if people lose coverage, threatening access and services to all patients, warned the American Hospital Association. Some Maryland hospitals already report that they aren’t taking in enough revenue under the state’s highly regulated billing system.

All this as Maryland has worked to increase the number of people getting health care, either through Medicaid or subsidized private plans on the state’s health exchange. Another place the Trump administration could make cuts is to enhance federal subsidies that make private coverage more affordable, shorten the enrollment period and reduce the workforce that helps people enroll.

Traci Kodeck, CEO of HealthCare Access Maryland, which works with the state to enroll people in health insurance, said the state has targeted so-called dreamers, or Deferred Action for Childhood Arrivals, pregnant people and those who found insurance unaffordable in the past.

The jump in coverage has improved individual health and community well-being and reduced disparities, Kodeck said. The exchange has increased the number of young people and the number of Black and Hispanic people with insurance, helping them manage chronic conditions and increasing the number of people able to get mental health and addiction services.

Cuts could mean more go without coverage, including federal workers in the state who are losing their jobs and will need private insurance or Medicaid, which would further burden state coffers.

It could mean a return to use of hospital emergency rooms for primary care, though hospitals are already struggling with some of the nation’s longest wait times.

“It’s a pivotal moment,” Kodeck said. “If there are cuts, we’d be going backward.”