Career guidance help - pivot away from Federal Government consulting?

I currently work at a large national consulting firm that has a fairly good reputation within in government contracting space. I primarily work with Medicaid (which the firm also has a good reputation with) at the federal level. I did survive several rounds of lay offs last year and things are feeling more stable.

I also recently received a job offer with a 22% salary increase for a smaller firm (~100 employees). Their primary clients are state Medicaid agencies (so still Medicaid, just at the state level). Obviously the salary increase would be great, but I've heard that Medicaid is shrinking and thus state budgets are shrinking. Medicaid is expected to be smaller by 2029.

I feel like there's more long term stability at my current firm, despite the lower salary. I've also been at my current company for 7 years and feel I have good relationships, do work that is engaging to me, and am excited about some of the future work.

Anyone have insight in the federal/state Medicaid landscape and have advice?