The healthcare landscape in the United States is undergoing seismic shifts, and few programs are feeling the impact as strongly as Medicaid.
Medicaid is jointly funded by the federal government and states, and provides free or low-cost health coverage to people with limited incomes, including low-income families, pregnant women, seniors, and people with disabilities.
By 2025, more than 85 million people in the United States will be enrolled in Medicaid, making it one of the largest public health programs in the country.
The enactment of the “Big and Beautiful” fiscal mega-package will cut Medicaid by more than $900 billion, the largest cut in the program’s history, in addition to making eligibility requirements more stringent starting in the coming years.
The Center on Budget and Policy Priorities (CBPP) estimates that, under the final legislation, between 9.9 and 14.9 million people will be at risk of losing Medicaid coverage.
The new law requires adults eligible for Medicaid expansion to work, perform community service, or study for at least 80 hours per month.
Experts believe this work requirement will harm parents, people with disabilities, and those with other chronic illnesses.
In fact, two-thirds of people ages 19 to 64 who received Medicaid in 2023 worked during the year, and many of those who did not were caring for a family member or had an illness or disability.
The legislation will also eliminate federal funding for Medicaid and the Children’s Health Insurance Program (CHIP), which were provided to most categories of immigrants living legally in the United States.
Groups who will no longer be eligible for federally funded coverage include people who have received humanitarian protection, such as refugees, asylees, and certain victims of domestic violence, human trafficking, or labor trafficking.
A provision in the legislation will remove Medicaid coverage from those, mostly seniors and those with disabilities, who also have Medicare, due to provisions that make it more difficult to obtain and remain enrolled in Medicaid.
Some people will also lose coverage due to new requirements requiring those enrolled in the expansion to prove their eligibility every six months (instead of annually).
These requirements often result in eligible individuals being excluded from Medicaid because they do not receive or submit the necessary documentation, or because the state does not process the documents.
The legislation requires states to charge working people with incomes just above the poverty line—$16,000 a year for one person—new co-pay fees for many services when they go to the doctor.
A new $50 billion Rural Health Transformation Fund over five years will offset some of the Medicaid funding losses in some states, but experts believe it will not come close to replacing stable national coverage or long-term federal funding.
Proponents of these changes argue they are necessary to control costs and reduce fraud. But critics believe the new model prioritizes cuts over the well-being of the most vulnerable.
