Week 7: What the Final AY26 Budget Means for Health Care in Georgia
Last Wednesday, the House and Senate reached an agreement on the Amended Fiscal Year 2026 (AY26) state budget. The final version now goes to the Governor for his signature, after which the new spending plan will take effect.
Here is what this budget means for health care, human services, and the programs Georgians rely on:
The Big Picture
The final AY26 budget includes major investments in mental health infrastructure and physician training while cutting funding for programs that directly affect consumer affordability and access. On the investment side: $409 million for a new 300-bed state mental health hospital (adopting the Senate’s approach), a $20 million hybrid graduate medical education package, near-full preservation of the House’s foster care funding, and a $45 million Housing Trust Fund compromise.
On the cuts side: the conference committee reduced state funding for the reinsurance program that stabilizes individual market premiums and rejected $35 million for modernizing the Gateway eligibility system.
Medicaid and PeachCare
The conference committee aligned Medicaid funding more closely with the House’s proposed funding levels. For the Aged, Blind, and Disabled population, the final budget includes an approximately $227 million adjustment to reflect enrollment and utilization growth. That amount is below the Senate’s proposed $241 million but is still a significant increase. Low-Income Medicaid and PeachCare adjustments remain enrollment-driven and consistent across all versions.
Georgia Gateway and Eligibility Systems
The conference committee rejected the $35 million to modernize Georgia Gateway, the online system used by more than 2 million Georgians to apply for Medicaid, PeachCare, SNAP, and other benefits. This is the second year in a row that this funding has been cut despite support from the Governor and the House. Gateway’s ongoing technical problems, including application errors and processing delays, make it harder for eligible families to get and keep the benefits they qualify for. Gateway’s technical issues also contribute to Georgia having one of the highest SNAP error rates in the country. Without this investment, Georgia will continue patching an outdated system rather than building one that works for families. The budget does include $6.2 million for targeted fixes to reduce SNAP errors, but the broader modernization effort does not move forward.
Rural Health and Workforce
The conference committee landed on a hybrid approach to graduate medical education that draws from both chambers. The base investment is the House’s $17.8 million for 103-plus residency slots across South Georgia. On top of that, the final budget adds two Senate-originated items: $432,000 for a psychiatry fellowship in Thomasville and $2.125 million for internal medicine residencies at Southeast Georgia Medical Center in Brunswick. The total GME package totals approximately $20.4 million, exceeding either chamber’s original proposal.
Other rural health items in the final budget: $3.2 million for the rural medical and dental clinic grant program (reduced from $4.8 million in both chambers), $734,000 for the Rural Surgery Initiative and child and adolescent psychiatry training at Augusta University (down from $1.2 million in the House), and $900,000 for health care access in East Central Georgia communities identified as medical deserts.
Behavioral Health and Mental Health Infrastructure
The conference committee adopted the Senate’s $409 million investment in a new 300-bed Georgia Regional Hospital in Atlanta, the first state mental health hospital built in Georgia since the 1960s. This is more than fifteen times the House’s $27 million proposal. The investment responds to a real crisis: over 750 people are waiting for a state hospital bed, with average waits approaching 10 months, and county jails have become de facto mental health facilities across the state. As we discussed in our Senate budget analysis, this investment also raises important questions about how a large congregate facility fits within the community-based mental health system Georgia has spent 16 years building since the Olmstead settlement. GHF will continue monitoring this facility’s development, and whether community-based services are maintained and increased to prevent Georgians from needing hospitalization altogether.
Other behavioral health items: $20.7 million for a 40-bed forensic restoration facility at East Central Regional Hospital in Augusta (matching the Governor’s recommendation).
Not included: the $500,000 behavioral health provider rate study focused on the abandonment of patients with intellectual and developmental disabilities in community hospitals. This House-only addition could have produced important data about whether reimbursement rates are adequate for people with IDD, and its absence means that question remains unanswered heading into FY 2027.
Child Welfare and Foster Care
The conference committee largely sided with the House on child welfare funding. Out-of-Home Care receives $81.1 million in state funds ($86.6 million total), very close to the House’s $82.7 million and nearly double the Governor and Senate’s $41.5 million recommendation.
Insurance and the Marketplace
This is the area where the conference committee made its most unexpected move. Both the House and the Senate had proposed a $25 million reduction to the 1332 waiver reinsurance program. The Senate then reversed that cut in its version. The conference committee not only reinstated the reduction but doubled it to $50 million, bringing total reinsurance funding from approximately $145.9 million down to roughly $95.9 million in state funds. Neither chamber had proposed a reduction of this size.
The reinsurance program stabilizes premiums on Georgia’s individual insurance market, and this cut comes at a particularly precarious moment. The state is simultaneously shifting reinsurance funding away from general appropriations and toward fees paid by insurers participating in Georgia Access. That means the program’s revenue base is increasingly tied to marketplace enrollment levels. If Georgia Access enrollment drops due to the loss of the enhanced premium tax credits (ePTCs), insurer fees will decline, and the revenue supporting reinsurance would shrink on top of this $50 million reduction. This could impact Georgia’s ability to stabilize and lower premiums for Georgia Access enrollees.
Other Health-Adjacent Investments
$45 million for the State Housing Trust Fund to address homelessness, a compromise between the House ($50 million) and the Senate ($10 million directed solely to veterans). A separate $5 million is included in the Department of Veterans Service budget to address veteran homelessness, bringing the total investment in homelessness to approximately $50 million.
$2.15 million for school-based mental health support, including $1.4 million for social workers and $750,000 for a pilot program helping districts maximize mental health services reimbursement.
What Comes Next
The conference committee report now goes to the Governor for signature. Once signed, these appropriations take effect for the remainder of FY 2026. GHF will be watching implementation closely, particularly around the reinsurance reduction, the mental health hospital’s design and integration with community services, and the Gateway modernization gap.
Understanding Georgia’s Budget Timeline
Georgia’s budget process can be confusing. Here’s what you need to know:
Two Budgets, Two Years:
Amended FY 2026 = Updates to the current year’s budget (July 2025 – June 2026)
FY 2027 = Brand new budget for next year (July 2026 – June 2027)
The Process:
Amended FY 2026
FY 2027
January
Governor proposes a plan → Agencies present their needs
Governor proposes a plan → Agencies present their needs
February–March
Lawmakers debate → House passes its version → Senate passes its version → Joint negotiations → Final vote
Can be signed into law once sent to the Governor (we are here)
Usually still in debate at this point in the session
Late March (Sine Die)
Usually already signed at this point in the session
Usually passes on last day of session
April–May
Usually already in effect at this point in the session
Governor signs into law
Why This Matters: The amended budget (AY 2026) shows how Georgia is spending state resources right now. The FY 2027 budget shows whether the state is preparing for emerging or new challenges, or just short-term needs.
Lead Sponsor: Rep. Hagan (R-156th) | Status: Passed the House, referred to the Senate HHS Committee | GHF Position: Monitor
What HB 657 does: Codifies DBHDD’s existing peer support specialist certification system in state law, defines five categories of certified peer specialists, and establishes a statutory framework for recovery community organizations (RCOs). The bill would also authorize DBHDD to designate a single statewide RCO to coordinate the network.
Consumer impact: Peer support from people with lived experience helps people in recovery. HB 657 would formalize the system to protect the integrity of community-based peer programs.
Lead Sponsor: Rep. Miller (D-62nd) | Status: Passed out of the House Budget and Fiscal Affairs Oversight Committee by Substitute (LC 59 0385S) | GHF Position: Monitoring
What HB 733 does: Creates a new insurance consumer and policyholder advocate position within the Georgia Department of Insurance and tightens rate-review rules by replacing the file-and-use system for auto insurance with a prior-approval process. Rate increase filings would be posted publicly within 10 days of submission, and any increase of 10% or more within 12 months would trigger a mandatory DOI examination.
Consumer impact: HB 733 does not explicitly apply to health insurance, which is a significant gap for Georgia consumers.
Lead Sponsor: Rep. Powell (R-33rd) | Status: Passed out of the House Insurance Committee | GHF Position: Monitor
What HB 961 does: Extends surprise out-of-network billing protections to emergency ground ambulance rides. Patients would pay no more than in-network rates for out-of-network ambulance services.
Consumer impact: Georgia’s current surprise billing law doesn’t cover ground ambulances, leaving patients vulnerable to unexpected bills of hundreds or thousands of dollars, even when they have insurance.
Lead Sponsor: Rep. Camp (R-135th) | Status: Passed out of the House Health Committee | GHF Position: Monitoring
What HB 1002 does: Would move Medicaid coverage for children in foster care from managed care (Georgia Families 360°) to fee-for-service Medicaid when current contracts expire, with an automatic repeal in 2028.
Consumer impact: Children in foster care have complex health care needs related to trauma. Some advocates believe direct access to any Medicaid provider (fee-for-service) would better serve these children than managed care’s more limited networks. However, managed care currently provides care coordination services that fee-for-service does not, which could lead to fragmented care. HB 1002 doesn’t address how to maintain care coordination during the transition.
Lead Sponsor: Rep. Hilton (R-48th) | Status: Still awaiting a vote in the House Ways and Means Subcommittee on Income Tax | GHF Position: Monitor
What HB 1110 does: Creates a state tax credit for small employers (10 or fewer employees) that contribute at least $100 per month toward employees’ individual health insurance through an Individual Coverage Health Reimbursement Arrangement (ICHRA).
Consumer impact: Many small businesses want to help workers with health coverage, but can’t afford traditional group plans. ICHRAs let employers contribute to employees’ individual health insurance costs. HB 1110 would make that approach more affordable for the smallest businesses. ICHRAs can negate and/or complicate an employee’s eligibility for financial assistance under the Affordable Care Act; the specifics of each employer’s ICHRA matter a lot to the actual financial impact on employees.
Lead Sponsor: Rep. Taylor (R-173rd) and others (bipartisan) | Status: Passed out of the House Health Committee | GHF Position: Monitor
What HB 1192 does: Requires the Department of Human Services and the Department of Community Health to keep funds designated for specific purposes in separate accounts and report annually to the legislature on cost savings and efficiency improvements.
Consumer impact: Greater transparency could help ensure that money designated for specific health programs actually goes to those purposes.
Lead Sponsor: Rep. Kelley (R-16th) | Status: Passed out of the House Health Committee | GHF Position: Monitoring
What HB 1236 does: Requires that when an insurer denies coverage based on medical necessity, a Georgia-licensed clinical peer with training in a related specialty must affirmatively agree to the denial. Current law allows insurers to deny care after a discussion with a clinical peer; HB 1236 requires the clinical peer to sign off on the decision. The bill also requires reviewers to attempt to contact the treating provider before issuing a denial.
Consumer impact: Georgians whose insurance companies deny coverage for medical treatment would gain a stronger safeguard. Requiring a Georgia-licensed specialist to agree to the denial, rather than simply participate in a discussion, adds a meaningful check on insurer decisions. Patients and providers would also receive clearer explanations for denials, supporting more effective appeals.
Lead Sponsor: Rep. Dempsey (R-13th) | Status: Passed out of the House Human Relations and Aging Committee | GHF Position: Support
What HB 1238 does: Directs the state to seek federal approval for Medicaid to pay for respite care services for families caring for children under 21 with serious behavioral health conditions who are at risk of going into foster care.
Consumer impact: Families caring for children with significant behavioral health needs often reach a breaking point. Respite care gives families temporary relief while keeping kids in their homes and communities, rather than resorting to foster care or residential facilities. Respite care costs less than institutional placements and produces better outcomes for children.
Lead Sponsor: Rep. Lumsden (R-12th) | Status: Passed out of the House | GHF Position: Support
What HB 1262 does: Raises the maximum penalties the Commissioner of Insurance can impose for violations of mental health parity reporting requirements, general insurance law, and the Surprise Billing Consumer Protection Act. The bill increases the current per-violation standard from $2,000 to $10,000 and the knowing-violation standard from $5,000 to $25,000.
Consumer impact: Because all penalties remain discretionary, the bill’s real-world value depends entirely on whether DOI chooses to use its expanded authority.
Lead Sponsor: Rep. Newton (R-127th) | Status: Passed out of the House Health Committee by Substitute (LC 52 1051S) | GHF Position: Oppose
What HB 1276 does: Prohibits Medicaid applicants and recipients from using self-attestation to verify income, residency, or identity and requires ongoing cross-checks of enrollees against multiple state and federal data sources. It also reduces retroactive Medicaid coverage from three months to two months, a change that likely requires federal CMS approval Georgia may not receive. If enacted as written, the bill risks erroneous disenrollments similar to the post-pandemic Medicaid unwinding and could expose Georgia to significant federal compliance liability.
Lead Sponsor: Rep. Jasperse (R-11th) | Status: Scheduled for a hearing in the House Health Committee today | GHF Position: Monitor
What HB 1299 does: Allows hospital authorities in rural counties (under 50,000 population) to jointly own outpatient healthcare facilities with a single group of specialty physicians. The hospital authority must own at least 51% of the facility.
Consumer impact: Could expand access to outpatient specialty care in rural communities where patients currently travel long distances. However, the bill does not require joint ventures to serve uninsured or Medicaid patients, and physician-hospital joint ventures raise questions about whether financial incentives align with community health needs.
Lead Sponsor: Rep. Clark (R-100th) | Status: Scheduled for a hearing in the House Health Committee today | GHF Position: Under Review
What HB 1332 does: Requires hospitals and healthcare facilities receiving state funds to prefer American-manufactured pharmaceuticals. Exceptions apply when domestic drugs are unavailable, would jeopardize patient safety, are needed during emergencies, or cost more than 20% higher. DCH enforces the law, and noncompliance can result in loss of state funding eligibility.
Consumer impact: While the bill aims to strengthen domestic drug supply chains, requiring a domestic sourcing preference could increase pharmaceutical costs for hospitals, particularly safety-net and rural hospitals that rely heavily on state funds and often use lower-cost generic medications manufactured overseas. Cost increases could be passed through to patients.
Lead Sponsor: Rep. Reeves (R-99th) | Status: Passed out of the House | GHF Position: Monitoring
What HB 1344 does: A wide-ranging insurance bill that strengthens DOI enforcement authority, insurance fraud penalties, and other areas specific to property and casualty insurance. The bill adds consumer protections for claims processing after disasters and increases penalties for violations by pharmacy benefit managers. The bill’s relevance to health insurance is narrower than its scope suggests, but the PBM enforcement and rate-review expansions have direct implications for Georgia health consumers.
Lead Sponsor: Rep. Kelley (R-16th) | Status: Passed out of the House Health Committee by Substitute (LC 52 1060S) | GHF Position: Monitoring
What HB 1354 does: Sets a 45-day deadline for commercial health insurers to complete credentialing of a provider after receiving a complete application and directs the Department of Insurance to create a standardized credentialing form aligned with Georgia Medicaid’s existing credentialing system. Slow and inconsistent credentialing is a major bottleneck to network adequacy, particularly for behavioral health providers, and the 45-day timeline matches Georgia’s own Medicaid standard. The bill currently lacks enforcement mechanisms and provisional credentialing provisions, which limit its real-world impact.
Lead Sponsor: Rep. Cooper (R-45th) | Status: Passed out of the House Public and Community Health Committee | GHF Position: Under Review
What HB 1368 does: Restructures governance of Georgia’s community service boards (CSBs) by transferring executive director appointment authority from local governing boards to the DBHDD Commissioner. Executive directors would become DBHDD employees with expanded powers over hiring, firing, contracts, and daily operations. The Commissioner could authorize executive directors to bypass governing board decisions when a CSB does not meet performance standards. HB 1368 is the House companion to SB 535.
Consumer impact: CSBs deliver behavioral health and developmental disability services across Georgia. Centralizing executive director appointments under DBHDD could improve accountability and address underperformance, but removes a key mechanism for community input into local behavioral health priorities. Governing boards would lose meaningful authority, and the bill does not define the “performance standards” that trigger state override of local decisions. Consumers and families who participate in CSB governance through local board membership would see their influence reduced.
Lead Sponsor: Sen. Hatchett (R-50th) | Status: Heard in the Senate Insurance and Labor Committee, but no vote was taken | GHF Position: Support
What SB 364 does: Creates new penalties for insurance companies that intentionally provide false or misleading information to state regulators to get higher premiums approved. The Commissioner could order violators to pay up to 10 times the amount they owe in refunds to policyholders.
Consumer impact: SB 364 creates a significant financial deterrent against insurance companies manipulating the rate-setting process. Combined with HB 1262’s general penalty increases, SB 364 would give regulators stronger tools to protect consumers from inflated premiums.
Lead Sponsor: Sen. Watson (R-1st) | Status: Passed the Senate; Assigned to the House Health Committee | GHF Position: Support
What SB 427 does: Creates a pathway for qualified physicians trained outside the U.S. to practice in Georgia. Eligible physicians would receive provisional licenses and must work in underserved areas for 2-4 years to qualify for full licensure.
Consumer impact: Georgia faces significant physician shortages, especially in rural areas. SB 427 would help address workforce gaps by allowing qualified international physicians to practice while meeting supervision and practice requirements.
Lead Sponsor: Sen. Kirkpatrick (R-32nd) | Status: Passed the Senate; Assigned to the House Health Committee | GHF Position: Support
What SB 428 does: Directs the state to seek federal approval by December 31, 2026, for a Medicaid waiver that would pay for home and community-based mental health services for adults over 21 who need ongoing support but don’t need institutional care. Eligibility would be based on risk factors like hospitalization history, psychiatric crises, emergency visits, prior incarceration, or homelessness.
Consumer impact: Currently, Medicaid often only covers mental health care when someone reaches a crisis or needs institutional care. SB 428 would allow Medicaid to cover ongoing community-based support that helps people remain stable and avoid costly crisis situations.
Lead Sponsor: Sen. Tillery (R-19th) | Status: Referred to Senate HHS Committee | GHF Position: Monitoring
What SB 460 does: Would transfer Medicaid eligibility determination from the Department of Human Services to the Department of Community Health. Currently, DHS and DCH share responsibility for Medicaid enrollment.
Consumer impact: The bill’s focus on fraud prevention through aggressive data matching and verification requirements could create barriers for eligible Georgians, particularly if data discrepancies produce false positives that result in coverage loss for Medicaid members. Implementation is further uncertain because the transfer requires federal approval, relies on a Gateway eligibility system that has experienced technical challenges, and grants DCH broad discretion over reevaluation frequency.
Lead Sponsor: Sen. Tillery (R-19th) | Status: Referred to Senate HHS Committee | GHF Position: Monitoring
What SB 461 does: Takes the opposite approach from SB 460, proposing to make DHS the single agency responsible for Medicaid administration. SB 460 and SB 461 represent competing visions for how Georgia should organize its Medicaid program.
Consumer impact: Moving Medicaid to DHS would separate coverage policy from health care delivery expertise, requiring DHS to build new capacity in complex areas such as care management contracts, provider reimbursement, and quality oversight, where the agency lacks deep experience. The transition faces uncertain federal approval timelines and significant implementation risks, as Medicaid has grown substantially more complex since Georgia last housed the program within DHS.
Lead Sponsor: Sen. Still (R-48th) and others | Status: Passed the Senate; Assigned to the House Health Committee | GHF Position: Monitor
What SB 462 does: Extends Georgia’s surprise billing protections to emergency ground ambulance transportation. SB 462 would cap what patients pay for out-of-network ambulance rides at the same amount they’d pay for in-network rides, and prohibit ambulance companies from billing patients for the rest. The bill sets a minimum payment rate for ambulance companies at the locally negotiated rate, or, if none exists, at the lesser of 325% of Medicare rates or the billed charges.
Consumer impact: Georgians currently face unexpected ambulance bills ranging from hundreds to thousands of dollars, even with insurance. SB 462 would close that gap in Georgia’s surprise billing law.
Lead Sponsor: Sen. Hodges (R-3rd) | Status: Passed out of the Senate | GHF Position: Under Review
What SB 500 does: Expands the existing Behavioral Health Care Workforce Database to cover all licensed health care professionals in Georgia and renames it the Health Care Workforce Database. The bill broadens the set of licensing boards required to participate in data collection without appropriating new funds or setting implementation deadlines.
Lead Sponsor: Sen. Kirkpatrick (R-32nd) and others | Status: Passed out of the Senate | GHF Position: Monitoring
What SB 535 does: Restructures governance of Georgia’s community service boards (CSBs) by transferring executive director appointment authority from local governing boards to the DBHDD Commissioner. Executive directors would become DBHDD employees. The Commissioner could direct executive directors to override governing board decisions when a CSB fails to meet performance standards. CSB conversions to nonprofit or other structures require Commissioner approval, and cessation of operations requires Governor approval. SB 535 is the Senate companion to HB 1368.
Consumer impact: CSBs are the primary delivery system for community-based behavioral health and developmental disability services in Georgia. Centralizing executive director appointments under DBHDD could improve statewide accountability and help address underperforming CSBs, but removes local community input from leadership decisions. The bill does not define the “performance standards” that would trigger a state override of local governing board authority, leaving significant discretion to DBHDD. Consumers and families who participate in CSB governance would see their influence reduced under the new structure.
Advocate With Us At The Capitol!
Join These Advocacy Events During the Legislative Session
Each week during the legislative session, we’ll highlight legislative advocacy days hosted by our partner organizations. These events offer excellent opportunities to engage in lawmaking by meeting your legislators and advocating for critical health issues.
Here are the upcoming events:
March 3 – GUHP & HSTAT Advocacy Day hosted by Georgians for a Universal Health Program and Health Students Taking Action Together
Please contact Anthony Hill at ahill@healthyfuturega.org if you have an advocacy event you’d like included in GHF’s legislative update.
We hope to see you at one or more of these impactful events!
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State lawmakers talk budget priorities: What’s on the table for Georgia’s health care
Sofi Gratas
Department heads across state agencies began outlining their spending priorities this week in joint budgetary hearings hosted by the Georgia Senate and General Assembly. During the hearings, department heads broke down…
