6 Ways Medicaid Cuts Are Likely to Impact You Personally

Key Points

• Experts predict it will be more difficult to find medical care, particularly if you live in a rural area.

• As more people become uninsured, medical providers and insurance companies will look to the general population to pay more.

• Now that a Biden-era mandate has been removed, nursing homes are free to cut staff, potentially cutting the quality of care available to patients.

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President Donald Trump's One Big Beautiful Bill Act (OBBBA) made significant cuts to Medicaid. The nonpartisan Congressional Budget Office (CBO) estimates that the OBBBA will slash federal spending on Medicaid and the Children's Health Insurance Program (CHIP) by $1.02 trillion and eliminate at least 10.5 million people from the programs by 2034.

As you'll see below, the cuts could affect you even if you're not on Medicaid. Here are six areas that deserve particular attention.

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1. Getting healthcare coverage through the Affordable Care Act will become more expensive

If you're insured through the Affordable Care Act (ACA, commonly referred to as Obamacare), you can expect to pay more. According to the Peterson-KFF Health System Tracker, enrollee premium payments will increase, on average, by 75%.

To fund continued tax cuts, the bill cuts current subsidies that have helped make ACA marketplace plans more affordable. The subsidies expire at the end of this year, and experts suggest new, higher premiums will lead to more than 4 million people becoming uninsured. The CBO estimates that the number of uninsured in the U.S. will rise by 16 million by 2034.

2. Those with traditional healthcare will also feel the pinch

You may be indirectly impacted by the OBBBA's cuts to the ACA, even if you have employer-sponsored healthcare. That's because more uninsured Americans will lead to more unpaid medical bills and healthcare prices will increase for all. Insurance companies and healthcare providers will not eat those losses but pass them on to consumers who can still afford to pay.

3. It could become more difficult to find healthcare in your area

Another concern raised by the passage of the OBBBA is what will happen to healthcare facilities in low-income areas. Based on past experience, experts predict that some hospitals and safety net clinics will be forced to close, particularly in rural areas.

4. If someone you care about is on Medicaid, expect changes in coverage

Currently, states tax healthcare providers and insurance companies up to 6% of net patient revenue to help cover Medicaid funding. States then receive matching funds from the federal government. The OBBBA caps the amount states can collect from providers and insurers at 3.5% for Medicaid expansion states, incrementally slashing a major funding source.

Medicaid is the primary payer for long-term services for seniors and people with disabilities, including nursing home and in-home care. While Medicaid is required to pay for nursing home care, home and community-based services are optional. Some states will be forced to cut these services first, reducing the options for older Americans who prefer to remain at home.

5. There will be fewer people caring for the elderly and disabled in nursing homes

Under previous law, a rule mandated minimum staffing levels in long-term care facilities. The goal was to ensure that there are enough employees in every long-term care facility to care for residents properly. The OBBBA effectively halts that mandate, meaning nursing homes can make staffing changes more flexibly. It's likely that cuts will result, and that could influence the quality of care you or someone you care about receives.

6. If you're on Medicaid, you may find that where you live matters

Medicaid is a state-run program. Given the level of reduced federal funding, wealthier states are expected to do a better job of filling the funding gap. But poorer states are more likely to reduce services.

While federal spending on Medicaid and CHIP has been cut by $1.02 trillion, the Bipartisan Policy Center reports that OBBBA's combination of tax cuts and spending increases will add more than $4 trillion to the national debt over the next 10 years.

It's important to remember that the OBBBA's impact may not be inevitable. Many of the most significant cuts to Medicaid are not scheduled to take effect for several more years, making it possible for future law changes to make further changes to some of the policies outlined in the OBBBA. For now, though, it's important to be prepared for the law's provisions as they currently stand.

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