Lawmakers in the House and Senate have proposed budget plans to address the federal deficit by capping spending, making deep cuts in Medicaid, and/or restructuring the way the nation finances health care for children, seniors, and people with disabilities. These budget plans will devastate the successful steps the nation has taken to provide quality, affordable health coverage to children. Medicaid and the Children’s Health Insurance Program (CHIP) cover about one-third of the nation’s children – in all more than 26 million children. Six in ten low-income children and four in ten children with special health care needs get their health coverage through Medicaid and CHIP. In this memo, CCF researchers explain why the only way to achieve major cuts to Medicaid’s current funding level is by dropping, or severely curtailing, coverage for those who depend on it.