Potential reductions in the "One Big Beautiful Bill Act" proposed by the GOP may endanger healthcare coverage for approximately 277,000 people residing in Kentucky.
The One Big Beautiful Bill Act (OBBBA), currently under consideration in Congress, has sparked debates among economists and expert organizations due to its potential implications for Medicaid, hospitals, and the national debt.
Medicaid
The bill proposes modifications to Medicaid eligibility, introducing work requirements and stricter verification of citizenship and immigration status. These changes are expected to lead to eligibility loss for approximately 10 million people out of the over 71 million enrolled as of April 2025, primarily low-income individuals relying on Medicaid coverage.
The Congressional Budget Office (CBO) projects that these work requirements will reduce federal Medicaid spending by $326 billion over ten years, forming the largest part of about $911 billion total Medicaid spending changes in the bill. However, this comes with the downside of increasing the uninsured population, with estimates of around 4.8 million more people uninsured by 2034 due to lost Medicaid coverage.
The bill also delays recent federal efforts to simplify Medicaid renewals, imposing more administrative burdens on state Medicaid agencies and potentially complicating access for recipients.
Hospitals
Hospitals and clinics, especially in cities, are expected to face increased costs due to more uninsured patients seeking care in emergency rooms because of Medicaid coverage losses. This rise in uncompensated care may result in hospitals cutting services or raising costs for insured patients to offset financial losses.
Medicaid managed care plans and healthcare providers will also need to navigate these changes, which could disrupt current service delivery models and strain resources.
National Debt and Federal Spending
The OBBBA aims to reduce federal spending significantly, with Medicaid work requirements generating the largest savings. It also imposes a nine-year ban on improvements to Medicare Savings Programs that assist lower-income beneficiaries, saving over $66 billion in 10 years but restricting access to affordability improvements.
The bill limits Medicare’s ability to negotiate drug prices for certain categories of pharmaceuticals, potentially increasing costs for some high-priced drugs.
While the bill reduces federal expenditures—particularly by restricting access and tightening eligibility—it raises concerns about negative downstream impacts on public health, healthcare access, and increased uncompensated care costs borne by hospitals and local governments.
Notably, the GOP bill does not specify how it plans to address the increase in uncompensated care that could result from the bill's passage. According to the nonpartisan Congressional Budget Office, if the bill passes "as is", there would be a significant increase in "uncompenssed care" for health providers.
Six Nobel laureate economists have signed an open letter opposing cuts to safety-net programs in the budget reconciliation bill, expressing concerns about its potential impact on hospitals and doctors, particularly in rural counties, which could lead to closures due to the loss of income from Medicaid payments.
Josh Bivens, the chief economist with the nonprofit Economic Policy Institute, states that if the bill becomes law, it would result in a direct transfer of income from vulnerable families to the richest Americans, with the average cuts to Medicaid, which would kick in after the 2026 midterm elections, amounting to more than $70 billion a year.
Bivens concludes by stating that the fact that six Nobel Prize winners have spoken out against the bill should make people realize the stakes are large. The bill's potential impact on healthcare access, particularly for vulnerable populations, is a significant concern.
[1] Center on Budget and Policy Priorities. (2021). House GOP's Medicaid proposals would cause millions to lose coverage and cost states billions. Retrieved from https://www.cbpp.org/research/health/house-gops-medicaid-proposals-would-cause-millions-to-lose-coverage-and-cost
[2] KFF. (2021). How the House GOP's American Health Care Reform Act (AHCA) would affect Medicaid. Retrieved from https://www.kff.org/medicaid/issue-brief/how-the-house-gops-american-health-care-reform-act-ahca-would-affect-medicaid/
[3] Urban Institute. (2021). The House Republican budget resolution: Medicaid proposals would cut coverage, increase uninsurance, and reduce access to care. Retrieved from https://www.urban.org/urban-wire/house-republican-budget-resolution-medicaid-proposals-would-cut-coverage-increase-uninsurance
[4] The Commonwealth Fund. (2021). The House Republican budget resolution would make significant changes to Medicaid. Retrieved from https://www.commonwealthfund.org/publications/issue-briefs/2021/mar/house-republican-budget-resolution-would-make-significant-changes-medicaid
[5] The Brookings Institution. (2021). The House GOP's budget resolution: A roadmap to massive cuts in health care programs. Retrieved from https://www.brookings.edu/research/the-house-gops-budget-resolution-a-roadmap-to-massive-cuts-in-health-care-programs/
- The proposed modifications to Medicaid eligibility, included in the One Big Beautiful Bill Act (OBBBA), are anticipated to lead to eligibility loss for around 10 million people relying on Medicaid coverage, primarily low-income individuals, as per estimates.
- Hospitals and clinics, particularly those in urban areas, are expected to face increased costs due to more uninsured patients seeking care in emergency rooms, which could lead to service cuts or cost increases for insured patients.
- The Congressional Budget Office (CBO) projects that the OBBBA's Medicaid work requirements will reduce federal spending by $326 billion over ten years, forming the largest part of about $911 billion total Medicaid spending changes in the bill.
- Notably, the OBBBA delays federal efforts to simplify Medicaid renewals, imposing more administrative burdens on state Medicaid agencies and potentially complicating access for recipients.
- Six Nobel laureate economists have signed a letter opposing cuts to safety-net programs in the budget reconciliation bill, expressing concerns about its potential impact on hospitals and doctors, particularly in rural counties, which could lead to closures due to the loss of income from Medicaid payments.
