Mental health programs are bearing the brunt of the New Hampshire Department of Health and Human Services’ first round of budget reductions after lawmakers approved a once-in-a-generation $51 million cut to the department in the two-year state budget.
Mental health services accounted for $3.1 million of the first-year cuts, with the largest share of the reductions coming from contracts with the state’s community mental health centers.
Funding was also scaled back for programs that help people transition home after psychiatric hospitalization, as well as homeless shelter services.
Jessica Williams, senior policy analyst at the New Hampshire Fiscal Policy Institute, analyzed the impact of the cuts in a new report released Wednesday. Williams said the department met $28.4 million of this year’s required savings by relying on unspent money tied to contracts from previous fiscal years.
After speaking with agency officials, however, Williams said those accounting options are unlikely to be available again.
“They will likely be facing some very tough decisions over the next year,” Williams said. “They’re not going to have that level of savings available to meet the reductions required for this year,” she added.
DHHS could not be reached for comment.
While mental health programs absorbed the largest share of the reductions, cuts also reached several other areas of the department, according to the report from the institute.
Williams said the $51 million back-of-budget reduction across the biennium “is the largest reduction that that department has seen in at least 30 years.”
In fiscal year 2026, the department reduced spending by $39.1 million. That total includes the required $25.5 million reduction in state General Funds, along with the loss of $7.4 million in matching federal dollars that would have accompanied those state expenditures.
Lawmakers approved the department’s funding cut last year when they passed New Hampshire’s two-year state budget.
Rather than specifying where the cuts should be made, the Legislature gave department leaders the flexibility to determine where to reduce spending.
One of the largest cuts outside of mental health was a $1 million reduction to the Healthy Families America Initiative, a program within the Division for Children, Youth and Families. The home visiting program supports child development, connects families with community resources and supports economic stability for new parents.
Several family support and food assistance programs also experienced reductions.
About $30,000 was cut from the Supplemental Nutrition Assistance Program (SNAP) Employment and Training Program, which helps participants build job skills, earn educational credentials and find employment, according to the report.
Williams said the program can be especially valuable for people working to meet employment requirements or transition off SNAP benefits altogether.
The report also identified a larger reduction of about $180,000 to the WIC Farmers Market Nutrition Program. The relatively new initiative provides WIC participants with vouchers to purchase fresh, locally grown fruits and vegetables at farmers markets and other approved locations across the state.
“While DHHS did classify these reductions as not impacting participants currently receiving services under these programs, it certainly could limit those programs’ ability to meet more Granite Staters and meet an increased need across the state,” said Williams. “They may not be able to provide more participants with services in the future.”
