The effects of last year’s One Big Beautiful Bill Act will soon be felt by states, providers, and consumers and some of them are already preparing for the impact.
States face an expected loss of $664 billion in Medicaid money over the next eight years as a result of 12 provisions in the 2025 law. The major causes: Medicaid work requirements that will reduce eligibility, more frequent eligibility redeterminations, and tougher limits on revenue-generating Medicaid provider taxes and Medicaid managed care state-directed payments.
Some states will lose more than others. The biggest losers, by percentage, will be Arizona, Iowa, and Nevada, with California and New York expected to lose the most money overall.
Many hospitals, anticipating a loss of Medicaid revenue and an increase in uncompensated care – the latter a result of patients losing Medicaid eligibility and the elimination of Affordable Care Act-related enhanced insurance premium subsidies – are taking steps to offset some of their potential losses. Among their actions: closing selected services – like maternity; closing health centers; consolidating medical practices; and laying off employees.
Meanwhile, millions of people face the loss of health care coverage as a result of the Medicaid cuts and the reduced health insurance subsidies.
Learn more about some of the challenges that states, providers, and health care consumers face as a result of the One Big Beautiful Bill Act from the Fierce Healthcare article “State Medicaid budgets to weather $664B reduction through 2034 due to OBBBA: RAND” and the CNN report “Hospitals are making cuts after ‘big beautiful bill,’ fueling Democrats’ midterm attacks.”