Federal budget bills are not the kind of discussion frequently encountered in day to day review. Still the “One Big Beautiful” Bill just recently passed by Congress by a narrow thin margin and criticized even by many Republican Congress members who eventually voted for it probably inspires more conversation and debate than any since the Affordable Care Act (Obamacare).
Once again a primary reason for the discussion is the effect on American’s health care. Few Americans watching at the time would forget John McCain’s memorable vote on the Senate floor sustaining the Affordable Care Act. This Bill will probably be recalled also for other reasons. While Medicaid issues and effects on hospitals in rural areas have been discussed in commentary there are other aspects that, generally speaking, have not been. Here are a few.
- Some health insurance premiums are expected to rise substantially. The Kaiser Family Foundation, a widely respected source for healthcare information, recently published an article that includes discussion of the bill’s effect including on persons not currently on Medicaid and not expected to apply for same, that is, in other words ordinary Americans. The article is titled “How Will the One Big Beautiful Bill Act Affect the ACA, Medicaid, and the
Uninsured Rate?” https://www.kff.org/policy-watch/how-will-the-2025-budget-reconciliation-affect-the-aca-medicaid-and-the-uninsured-rate/ June 18, 2025. To understand why health insurance premiums would rise for many under the OBBB it helps to know about a technical idea referred to as enhanced premium tax credits, a benefit available to many now to reduce their monthly premiums. Whether recipients recognized it or not, under the ACA, in addition to providing Medicaid to persons previously unable to receive it, the Act also reduced premiums for many especially in states that adopted Medicaid expansion. KFF, in describing changes, noted “These policy changes <under the OBBB> also come at a time when large health insurance coverage losses are expected if enhanced premium tax credits for ACA marketplace coverage expire at the end of 2025. The expiration of the enhanced tax credits will increase out-of-pocket premiums substantially and likely lead to millions of people dropping their coverage.” Id.
Under the Affordable Care Act, Americans became accustomed to many of its healthcare provisions since its passage in 2010. People whose income is low enough not to afford conventional healthcare insurance and who do not otherwise qualify for Medicaid, people who do not have health insurance coverage though employment and others in need of specialized coverage have been able to receive healthcare especially in the 40 states and Washington, DC that have adopted Medicaid expansion. Some of those states have provisions in state law indicating that if federal participation drops they will also drop Medicaid expansion.
“Marketplace” known in Pennsylvania as “Pennie” is under the Affordable Care Act. This is a fact unknown to many.
- It Is Not Just Rural Hospitals That Will Be Affected By the Act. Rural hospitals have so often been discussed as a source of concern for closure that it is tempting to believe that they are the only ones affected. Medicaid reductions affect other hospitals as well as is evidenced by multiple hospital closures in recent years throughout the country. The reason why reference is made so often to rural hospitals is because, due to their need, some have received help that is expected to drop considerably. In “The Truth About the One Big Beautiful Bill Act’s Cuts to Medicaid and Medicare,” https://www.americanprogress.org , the authors, Mia Ives-Rublee and Kim Musheno, describe the problem. “Rural hospitals have some of the lowest
operating margins especially compared with urban hospitals, meaning that any reductions in revenue could lead to closures. The average operating margin for rural hospitals was 3.1 percent in 2023, with 44 percent of rural hospitals operating with negative margins. As a result, more than 300 rural hospitals are currently at “immediate risk” of closure, especially now that the OBBBA is projected to cut Medicaid spending by $1.02 trillion. The relief fund designed to blunt the negative impacts caused by the bill would not come close to filling that gap…”
- CHIP will also be affected. The same article cites that the Children’s Health Insurance Program (CHIP) will also be affected. “The nonpartisan Congressional Budget Office (CBO) estimated that the OBBA will cut federal spending on Medicaid and Children’s Health Insurance Program (CHIP) benefits by $1.02 trillion, due in part to eliminating at least 10.5 million people from the programs by 2034…”Stay tuned.
Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.
