The One Big Beautiful Bill Act: A Double-Edged Sword for America's Health and Economy

The fate of the Trump administration’s legislative centerpiece — the One Big Beautiful Bill Act — continues to be the focal point in Washington, D.C. After the bill’s narrow passage in the House, the Senate is working to put its own stamp on the reconciliation package, which encompasses policy changes on taxes, border security, energy, and deficit reduction, including significant changes and cuts to Medicaid and other health care programs. Republicans are aiming to have the legislation through the Senate by the July 4 congressional recess; however, any changes made by the Senate would have to go back to the House for approval.

The bill, as it stands, is a double-edged sword. On one hand, it promises fiscal discipline and program integrity, aiming to reduce federal Medicaid and Affordable Care Act (ACA) subsidy spending by approximately $1.25 trillion over the next decade. On the other hand, it threatens to strip health care coverage from nearly 11 million Americans, exacerbating an already dire situation for many families across the country.

The bill’s provisions targeting Medicaid are particularly concerning. The Congressional Budget Office (CBO) estimates that the bill would increase the number of people without health insurance by 10.9 million, largely due to changes in Medicaid and the ACA. This comes at a time when enhanced premium tax credits for ACA Marketplace enrollees are set to expire later this year. When combining the reconciliation bill’s effects with that of the expected expiration of the ACA’s enhanced premium tax credits, CBO expects 16.0 million more people will be uninsured in 2034 than would otherwise be the case.

The impact of these cuts would be devastating, particularly for low-income families and those in rural areas where access to care is already limited. According to a report from the Commonwealth Fund and the George Washington University Milken Institute School of Public Health, potential budget cuts to Medicaid and the Supplemental Nutrition Assistance Program (SNAP) could lead to severe economic consequences across all 50 states and the District of Columbia. Specifically, these combined cuts could result in one million jobs lost, a $113 billion decline in states’ gross domestic products (GDPs), and $8.8 billion in lost state and local tax revenue in 2026 alone.

The ripple effects of these job losses and economic declines would be far-reaching. As hospitals, health care providers, and food retailers face lost revenue, they would be forced to reduce jobs and services, which would further reduce economic activity in other sectors. This decline in employment and wages would lead to decreased consumer spending, impacting businesses across various industries. With lower consumer spending, state and local governments would see a significant drop in tax revenues, further hampering their ability to fund essential services.

The bill’s provisions also include community-engagement requirements for able-bodied adults without dependents, which would mandate work, study, or volunteer for at least 80 hours per month to retain Medicaid coverage. While this provision aims to restore Medicaid’s role as a safety-net program, it could also create additional barriers for those already struggling to make ends meet.

Moreover, the bill’s changes to the child tax credit would block families of as many as 20 million children from receiving the full $2,500 credit. This would disproportionately affect low-income working families with children, who would remain unable to access the full credit and wouldn’t benefit from the $500 increase, as higher-income families up to $400,000 receive the full credit, increased to $2,500 total.

The Senate Finance Committee, which has jurisdiction over taxes and Medicaid, could release its legislative text as soon as this week. There have been discussions about additional restrictions on Medicaid state-directed payments and provider taxes, which would further exacerbate the chronic underpayment for Medicaid services and threaten access to care for all patients in communities across the country.

In response to these concerns, various advocacy groups, including the American Hospital Association (AHA), are pulling all levers to limit the scope and magnitude of health care reductions contained in this package. They have been meeting with senators and their staff to explain the devastating effects some of the policy changes under consideration would have on the people and communities they represent. Additionally, targeted advertising campaigns are urging Congress to protect Medicaid and access to care.

On Tuesday, June 17, the AHA will host an Advocacy Day in Washington, D.C., during which hospital and health system leaders will meet with their lawmakers on Capitol Hill to discuss the latest updates on the reconciliation bill. If you cannot be in Washington, AHA members can register to participate in the event virtually.

In addition, new resources are being produced to highlight how the bill’s Medicaid reductions could lead to job and economic losses in states, as well as why Medicaid is so important to rural hospitals and communities. A video series featuring hospital and health system leaders sharing the importance of Medicaid and how drastic cuts would impact access to care for their patients and communities is also in the works.

We’re at a critical juncture. It’s so important for hospital leaders, patients, and community members to weigh in now with your senators and tell them “Don’t Cut Hospital Care.” Your stories have the most impact with your lawmakers, and now is the time to tell them.