The “one big beautiful bill” that was just passed by the Senate has not been framed as a health reform plan. But make no mistake: This Republican policy bill is effectively a partial repeal of the Affordable Care Act to help pay for tax cuts, and should it reach President Trump’s desk, it would represent the biggest rollback in federal support for health coverage ever.
A preliminary estimate from the Congressional Budget Office projects that the bill would reduce federal spending for Medicaid and the Affordable Care Act’s provisions by more than $1 trillion over a decade, resulting in nearly 12 million more people becoming uninsured by 2034.
It comes as other changes to health insurance are looming. Tax credits to subsidize the premiums for people who get their insurance through Obamacare marketplaces — first passed by Democrats during the Covid pandemic in 2021 — are set to expire at the end of 2025. If Republicans and Mr. Trump do not agree to extend the tax credits, which appears to be their inclination, out-of-pocket premiums for these enrollees will increase by over 75 percent on average. Because some won’t be able to pay the higher premiums, the budget office expects four million will end up uninsured.
An additional roughly one million people are expected to lose coverage as a result of recent Trump administration regulations that make it harder to sign up for coverage through the Affordable Care Act. One consulting firm estimates that enrollment in marketplace plans will ultimately drop by about half.
In total, the policy bill and these other changes could lead to a staggering 17 million more people uninsured. By one estimate, the potential increase in the number of people uninsured, both through Republican actions and inaction, would erase almost three-quarters of the gains in coverage from the Affordable Care Act.
It is rare to see public benefits taken away from people once they’re in place, and this level of cuts to health insurance would be extraordinary.
By expanding Medicaid, guaranteeing access to insurance for people with pre-existing conditions and providing tax credits to make insurance more affordable, the Affordable Care Act has brought the country as close to universal health coverage as we’ve ever been. Twenty-five million Americans, roughly 8 percent of the population, were uninsured in 2023, the lowest level ever and almost half the number who were uninsured in 2010 when the Affordable Care Act passed.
In contrast to the last time Republicans took full control of the federal government in 2017, there’s been no explicit talk of trying to repeal Obamacare. But the Medicaid reductions in the budget bill are targeted at the 40 states plus the District of Columbia that have expanded Medicaid under the Affordable Care Act, half of them red states.
For example, the largest source of federal Medicaid cuts would result from a work requirement that applies to adults who received coverage as part of the Medicaid expansion. Over nine in 10 adults covered by Medicaid are working or could qualify for an exemption because, for example, they’re a parent caring for children, ill or in school. Yet the Congressional Budget Office estimates the requirement would result in about five million Americans losing insurance.
People would largely lose insurance not because they were ineligible under the new requirements, but because of added red tape. States could require Medicaid enrollees to report work or exemptions as often as every month, and many people would probably fail to navigate this process. That’s exactly what happened when Arkansas had a Medicaid work requirement in 2018, before it was overturned by the courts.
The bill would also roll back taxes on hospitals that states use to help finance their Medicaid programs and pay providers adequate rates for care for Medicaid patients. But this cutback in hospital taxes would apply only to states that have expanded Medicaid. (A separate moratorium on new provider taxes would apply in all states.)
It’s not just the one-third of Americans who get their insurance through Medicaid or marketplace plans that will be hurt. Changes on this scale will have ramifications throughout the health care system.
Rural communities, in particular, are vulnerable. Medicaid covers one-fifth of hospitalizations and nearly half of all births in rural areas. Profit margins are lower for rural hospitals, and Medicaid cuts could push more of them to close down. The bill includes a temporary rural health stabilization fund of $50 billion, but that won’t fully blunt the cuts, which are permanent.
What this will all mean politically, especially for next year’s midterm election, is unclear.
Several recent polls show the Republicans’ policy bill is unpopular. And that’s even before people have absorbed what’s actually in it. A poll by my organization, KFF, in June found that nearly two-thirds of respondents viewed the bill unfavorably.
To be sure, the health care changes in the bill are complicated, and may be difficult for the public to absorb. And, some ideas, like work requirements, could resonate with many voters. Republicans frame the Medicaid cuts as eliminating fraud, waste and abuse, which will also sound good to voters. But there is little in the bill to address outright fraud (which is generally perpetrated by rogue health care providers, not enrollees).
Many of the provisions of the policy bill won’t take effect immediately, and the full effects will take years to materialize. (In contrast, if the enhanced Affordable Care Act premium tax credits are allowed to expire, out-of-pocket premiums for marketplace enrollees will skyrocket on Jan. 1.)
But Democrats will be able to point out that Republicans have just voted for the biggest health care cutbacks ever.
Republicans paid a political price in the 2018 election after attempting to repeal the Affordable Care Act. We’re about to find out whether they will pay a similar price for what is in effect a partial repeal of that landmark health care law.
Larry Levitt is the executive vice president for health policy at KFF.
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