Medicaid, SBA loans, student loans, SNAP: What is and isn’t affected by Trump’s freeze on federal grants?

Monday’s memo from the White House Office of Management and Budget (OMB) pausing federal grants and loans set off a scramble in Washington and across the nation as administrators and individuals tried to figure out how the order would affect funding, from the SBA to Medicaid to the Pell grant program. (It also drew a flurry of lawsuits.) An addendum issued Tuesday has offered a bit more information, but things are still hardly crystal clear.

The original memo, from acting director Matthew J. Vaeth, ordered federal agencies to “temporarily pause all activities related to obligations or disbursement of all Federal financial assistance” and conduct a “comprehensive analysis” of their grant and loan programs. Specifically, those analyses were to ensure the programs fell in line with Donald Trump’s executive orders banning federal diversity, equity and inclusion (DEI) initiatives, limiting clean energy spending, and more.

Slated to go into effect Tuesday at 5 p.m. ET, the new rules have baffled both federal organizations and private companies that work with them. In an attempt to clarify things, the OMB put out another memo Tuesday, saying the pause was not across the board. White House press secretary Karoline Leavitt, in her first briefing, also attempted to explain the freeze, but didn’t provide much more clarity other than to reiterate that the ban would not impact individual benefits.

It’s still unclear how many programs will be affected and for how long, but here’s where things stand with some of the largest programs.

SBA loans

The Tuesday memo clarified that the freeze is not an across-the-board action and was “expressly limited to programs, projects, and activities impacted by the President’s Executive Orders.” Funds for small businesses, it read, will not be paused. (The Small Business Administration did not reply to Fast Company’s request for comment about the memo.)

Student loans

Student loans, including Pell grants, are also safe, the second memo said. “Any program that provides direct benefits to Americans is explicitly excluded from the pause and exempted from this review process.”

Leavitt echoed this in her press conference, saying, “Individuals who receive direct assistance, you will not be impacted by this freeze.”

Medicaid

But with Medicaid, things have been a little more murky. Tuesday’s OMB memo said Medicaid would continue without pause. But Senator Ron Wyden (D-Oregon), on BlueSky Tuesday, said his staff had confirmed reports that Medicaid portals, which tie into the Federal Payment Management System (FMPS), were down in all 50 states after the funding freeze. (A search of select state portals shows them to be operational, but some have reported they are currently locked out of the FMPS.) That followed a report from the Chicago Sun-Times that Illinois had been cut off from the portal used to request and manage Medicaid spending.

The FMPS website, Tuesday afternoon, had an alert at the top of its webpage: “Due to Executive Orders regarding potentially unallowable grant payments, PMS is taking additional measures to process payments. Reviews of applicable programs and payments will result in delays and/or rejections of payments.” (The Head Start preschool program for low-income children also uses FMPS to access funds.)Leavitt later posted on X, referring to the portal problems as an outage. “The White House is aware of the Medicaid website portal outage,” she posted. “We have confirmed no payments have been affected—they are still being processed and sent. We expect the portal will be back online shortly.”

SNAP benefits

The Supplemental Nutrition Assistance Program (formerly known as food stamps), which helps low-income adults purchase food is another “mandatory program” that OMB said would not be affected by the freeze.

Social Security and Medicare

OMB, in its original memo, went out of its way to note that Social Security and Medicare payments would not be impacted by the order.

Rental assistance

Monday’s clarifying memo said funds for rental assistance will not be paused.

Countless other disbursements, such as health grants distributed by the Centers for Disease Control and Prevention (CDC), developers expecting federal grants, and programs from the Departments of Agriculture, Commerce, Defense, Education, Energy, Health, Justice and Human Services, and more are still in question.