The "One Big Beautiful Bill Act"
The "One Big Beautiful Bill Act," also referred to as President Donald Trump's "megabill," is expected to fundamentally alter the American social safety net by implementing significant cuts to federal support for programs like Medicaid and the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps. These changes are projected to lead to millions losing coverage or benefits and will place increased burdens on individuals and state governments.
Here's how the bill is expected to affect key components of the social safety net:
Medicaid
Work Requirements:
The bill introduces a new work requirement for certain able-bodied Americans aged 19 to 64 who are enrolled through the Medicaid expansion. This mandate would require them to work, volunteer, attend school, or participate in job training for at least 80 hours per month. Parents of children aged 14 and older would also be subject to this mandate.
Eligibility and Enrollment:
Expansion enrollees would face more frequent eligibility reviews and could be required to pay up to $35 for certain care. The bill would delay the implementation of some Biden administration rules aimed at streamlining enrollment and renewing coverage, and many enrollees would face more paperwork and verification requirements, potentially making it harder to apply for and maintain benefits.
Federal Funding Cuts:
States would receive less federal funding for the Medicaid program. This reduction could compel states to eliminate certain benefits, tighten enrollment, or make other alterations to their programs.
Impact on Coverage:
A Congressional Budget Office (CBO) analysis, prior to final Senate changes, estimated that nearly 12 million more people would be uninsured by 2034, with many losing coverage due to the Medicaid provisions.
Broader Healthcare Impact:
Hospitals, especially in rural areas, are warning that steep Medicaid cuts could force them to close, limit services, and reduce staff, potentially harming access to care for all Americans, not just those on Medicaid. Lower-income seniors enrolled in both Medicare and Medicaid could lose their Medicaid coverage, which helps cover Medicare premiums and out-of-pocket costs, and also lose benefits like long-term care and dental services.
Immigrants:
The bill would limit eligibility for federal benefits, including Medicaid, to a smaller set of noncitizens, meaning some immigrants like refugees and asylees would no longer qualify.
Supplemental Nutrition Assistance Program (SNAP) / Food Stamps
Work Requirements:
The bill broadens the existing work mandate for food stamp recipients to include enrollees aged 55 to 64, parents of children aged 14 and older, veterans, former foster youth, and people experiencing homelessness.
State Costs:
Many states would be required to cover part of the benefit costs for the first time and pay more of the administrative costs. This could force states to tighten benefits, cut eligibility, or even potentially withdraw from the SNAP program.
Benefit Growth Limits:
The future growth of food stamp benefits would be limited.
Impact on Local Economies:
A trade group for independent grocers warned that cutting federal support for SNAP could harm local food retailers, particularly in rural and underserved areas, which increase access to groceries and provide jobs.
Immigrants:
Eligibility for food stamps would be limited for some noncitizens, including refugees and asylees.
Affordable Care Act (ACA) Policies (Obamacare)
Access to Coverage:
Americans seeking coverage on Obamacare exchanges could face a tougher time enrolling and receiving federal subsidies to help pay premiums.
Verification and Reenrollment:
The bill would increase verification requirements and effectively end automatic reenrollment.
Impact on Coverage:
The CBO estimates that millions of people would lose their Obamacare coverage.
Immigrants:
Eligibility for Affordable Care Act premium subsidies would be limited for some noncitizens.
Overall Impact on Low-Income Americans and the Wealthy
A Yale Budget Lab report indicates that while all households might see tax reductions, lower-income Americans would see their income reduced after factoring in the changes to Medicaid and food stamps.
Generally, the wealthy would benefit far more from the tax package, with about 60% of the benefits going to the top 20% of earners.
In essence, the bill significantly alters the social safety net by shifting responsibilities and costs to states, imposing stricter eligibility and work requirements on beneficiaries, reducing federal funding for critical programs, and consequently leading to a projected increase in uninsured people and a decrease in access to food and health assistance for vulnerable populations.
The "One Big Beautiful Bill Act" is expected to significantly impact state government funding by reducing federal support for key social safety net programs, forcing states to potentially shoulder more costs and make difficult financial decisions.
Here's how the bill is projected to affect state government funding:
Massive Reductions in Federal Support:
State lawmakers would face massive reductions in federal support for Medicaid and food stamps.
Increased State Costs for SNAP (Food Stamps):
For the first time, many states would be required to cover part of the benefit costs for the Supplemental Nutrition Assistance Program (SNAP).
States would also have to pay more of the administrative costs for the SNAP program.
These changes could compel states to tighten benefits, cut eligibility, or make other alterations, including potentially withdrawing from the SNAP program altogether.
Reduced Federal Funding for Medicaid:
States would receive less federal funding for the Medicaid program. This reduction could force states to eliminate certain benefits, tighten enrollment, or make other alterations to their programs.
Impact on State and Local Tax Revenue:
The bill would reduce the amount of taxes that state and local governments can levy on providers, especially hospitals, which is a key source of funding for states.
Tough Decisions for States:
Facing these reductions and increased costs, state lawmakers would likely have to make tough decisions. They could try to limit the cost of the affected programs by cutting benefits or eligibility, or they might decide to try to save money in other areas, such as education or infrastructure.
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