On Thursday, May 22, 2025, the U.S. House of Representatives narrowly passed the One Big Beautiful Bill Act, a budget reconciliation bill introduced by House Republicans, by a 215-214 vote. The bill extends key provisions of the 2017 Tax Cuts and Jobs Act, currently set to expire at the end of 2025, and allocates additional funding for defense and other federal priorities. It also includes reductions in government spending and revised eligibility requirements for several federal aid programs.
Among the provisions, the bill includes over $700 billion in proposed changes to Medicaid, the joint federal-state program that provides health insurance to low-income individuals and families, as well as certain people with disabilities and limited financial resources. These changes are intended to reduce federal outlays and are projected to significantly impact both Medicaid beneficiaries and the healthcare providers who serve them.
Key Medicaid Measures
The One Big Beautiful Bill Act proposes to achieve these savings through several policy changes. The estimated budget impact of each change over the next decade, as calculated by the nonpartisan Congressional Budget Office (CBO) and published here, is listed in parentheses below.
- Community Engagement Requirements. Beginning in 2026, able-bodied adults would be required to complete 80 hours per month of work, volunteering and/or attending school to maintain eligibility for Medicaid, with certain exemptions (e.g., pregnant women and the elderly) (~$280B, which estimate was based on these requirements going into effect in 2029).
- Increased Frequency of Eligibility Redeterminations. States would be required reverify Medicaid eligibility for expansion populations every six months, rather than annually (~$53.2B).
- Moratorium and Limits on Provider Taxes. The bill would prohibit states from creating new provider taxes or expanding existing ones, and would restrict how provider taxes can be used to finance Medicaid. (~$123.9B combined).
- Enrollment Streamlining Moratoriums. The bill would pause implementation of certain rules designed to streamline enrollment in Medicaid, the Medicare Shared Savings Program, the Children’s Health Insurance Program (CHIP), and the Basic Health Program (~$167.3B combined).
- Enhanced Verification Standards. New address and documentation verification requirements would apply for Medicaid enrollment (~$17.4B).
- Cost Sharing Requirements. States would be required to implement new cost-sharing charges for low-income individuals just above the poverty line ($16,000 per year for an individual) when they seek care. (~$13B).
Anticipated Impact on Coverage and Providers
Medicaid and CHIP currently provide health coverage for nearly 80 million people, making them the largest source of insurance coverage in the United States. According to earlier CBO estimates of a previous version of the bill, approximately 7.6 million people could lose coverage. The House-passed version would likely result in additional losses, given that certain provisions, such as the work requirements, would take effect earlier than previously modeled.
These coverage reductions could also affect healthcare providers, particularly those that serve communities with high Medicaid enrollment, as they may see changes in patient volumes.
What’s Next?
The bill now moves to the U.S. Senate, where it is expected to undergo further debate and potential revisions. While some senators have called for additional spending reductions, others, across the political spectrum, have raised concerns about the scale of the Medicaid-related changes. Republican leadership has expressed an intent to move the bill forward with the goal of delivering it to President Trump’s desk by July 4th.