Washington state is facing a potential budget shortfall by 2027, with projections showing a deficit by 2028 despite recent increases in both taxes and revenue. At the center of the conversation is the federal Big Beautiful Bill, which adjusts Medicaid eligibility and could affect state healthcare funding.
Governor Bob Ferguson’s administration has cited the bill as a contributor to what has been called the state’s most significant budget crisis. However, some lawmakers suggest the focus on federal policy overlooks internal fiscal decisions. Senator Ron Muzzall, the ranking member of the Senate Health and Long-Term Care Committee, emphasized the role of state-level spending growth and a lack of reserves.
Washington’s operating budget has more than doubled since the 2013–15 biennium, driven largely by increases in Medicaid and long-term care costs. Recent state-funded expansions have included coverage for undocumented residents, adding $150 million in spending this biennium.
The 2026 legislative session is expected to bring tough fiscal decisions. As lawmakers prepare, discussions continue about balancing federal impacts with the need for long-term budget discipline.
