Senate passes FY27 veterans and HHS budget after debate over Medicaid cuts and program funding
May 02, 2026 | 2026 Senate, Legislative, Iowa
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The Senate on the floor approved House File 27 82, the FY2027 Veterans and Health and Human Services budget, after adopting a conforming amendment and substituting the House measure for Senate File 24 83.
Senator Costello, the bill sponsor, told the chamber that “this bill appropriates over 2,560,000,000 from the general fund and 4,724 FTEs for FY27,” and described additional appropriations from other funds and net changes compared with FY26. He moved adoption of Senate Amendment S5249 and later asked unanimous consent to substitute House File 27 82 for the original Senate file.
Why it matters: The bill funds veterans services and a broad set of health and human services programs for FY27 and adjusts staffing levels. Opponents warned the changes will reduce access to care for vulnerable Iowans and exacerbate shortfalls in Medicaid funding.
Senator Petersen (Polk) urged rejection of the package, arguing the legislation “is not a healthy budget for Iowans,” and citing what he described as large Medicaid cuts, closures of labor-and-delivery departments and reductions in mental-health capacity. Petersen also said the state carried forward “more than a $100,000,000 in federal child care dollars” that could have been spent sooner and warned that some programs, including a physician volunteer program serving “7,000 Iowans,” face cuts.
Senator Dre (Woodbury) pressed for more support for veterans, saying the Iowa veterans homeownership program “is out of money and has been since April” and asking the chamber to fund it for the full fiscal year so veterans are not left waiting.
Costello emphasized investments in long-term care and treatment services, noting an appropriation of $300,000,000 for nursing facilities and home-and-community-based services waivers and $3,000,000 for an opioid treatment program in the Cedar Falls area that he said will add 150 licensed beds.
On the final motion the Senate recorded 30 ayes and 14 nays; the Secretary read the bill title and the chamber declared the bill passed. After passage, Senator Costello asked unanimous consent to withdraw Senate File 24 83; the Senate ordered the withdrawal and agreed to immediately message House File 27 82 to the House.
Votes at a glance: The roll call recorded 30 ayes and 14 nays; selected recorded ayes that were read on the floor include Senator Whitver, Senator Dickey and Senator Bussello.
Next steps: The measure was ordered messaged to the House.
Senator Costello, the bill sponsor, told the chamber that “this bill appropriates over 2,560,000,000 from the general fund and 4,724 FTEs for FY27,” and described additional appropriations from other funds and net changes compared with FY26. He moved adoption of Senate Amendment S5249 and later asked unanimous consent to substitute House File 27 82 for the original Senate file.
Why it matters: The bill funds veterans services and a broad set of health and human services programs for FY27 and adjusts staffing levels. Opponents warned the changes will reduce access to care for vulnerable Iowans and exacerbate shortfalls in Medicaid funding.
Senator Petersen (Polk) urged rejection of the package, arguing the legislation “is not a healthy budget for Iowans,” and citing what he described as large Medicaid cuts, closures of labor-and-delivery departments and reductions in mental-health capacity. Petersen also said the state carried forward “more than a $100,000,000 in federal child care dollars” that could have been spent sooner and warned that some programs, including a physician volunteer program serving “7,000 Iowans,” face cuts.
Senator Dre (Woodbury) pressed for more support for veterans, saying the Iowa veterans homeownership program “is out of money and has been since April” and asking the chamber to fund it for the full fiscal year so veterans are not left waiting.
Costello emphasized investments in long-term care and treatment services, noting an appropriation of $300,000,000 for nursing facilities and home-and-community-based services waivers and $3,000,000 for an opioid treatment program in the Cedar Falls area that he said will add 150 licensed beds.
On the final motion the Senate recorded 30 ayes and 14 nays; the Secretary read the bill title and the chamber declared the bill passed. After passage, Senator Costello asked unanimous consent to withdraw Senate File 24 83; the Senate ordered the withdrawal and agreed to immediately message House File 27 82 to the House.
Votes at a glance: The roll call recorded 30 ayes and 14 nays; selected recorded ayes that were read on the floor include Senator Whitver, Senator Dickey and Senator Bussello.
Next steps: The measure was ordered messaged to the House.
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