Signed into law: July 4, 2025
Impact: Significant changes to healthcare coverage across the U.S., with long-term effects projected through 2034.

Key Medicaid Changes

1. Immigrant Eligibility Changes

• Federal funding eliminated for Medicaid and CHIP programs, projected to leave 100,000 people uninsured by 2034.

• System updates required: By Oct. 1, 2029, HHS must update systems to prevent duplicate state enrollment.

• Eligibility verification: By Jan. 1, 2028, states must use the SSA Death Master File quarterly to verify eligibility.

• More frequent reviews: States must re-determine eligibility for expansion enrollees every 6 months (instead of annually). This is expected to cause 700,000 people to lose coverage by 2034.

2. Work & Community Engagement Requirements

Effective: Dec. 31, 2026

• Expansion adults (ages 19–64) must complete 80 hours per month of work, education, or community service.

• Mandatory exemptions:

  • Pregnant women

  • Individuals with serious medical conditions

  • Tribal members

  • Parents/caregivers of children under 13 or children with disabilities

• Optional hardship waivers may be issued (e.g., inpatient care, natural disasters, high unemployment).

• HHS rule issued by: June 1, 2026

• Good faith extension available: Through Dec. 31, 2028

3. 6-Month Redeterminations

Effective: Dec. 31, 2026

• Adult expansion enrollees or those with Minimum Essential Coverage (MEC) through waivers must undergo redetermination every 6 months.

• All other Medicaid populations remain under the current 12-month requirement.

• CMS guidance due: Dec. 31, 2025

4. Retroactive Coverage Limits

Effective: Jan. 1, 2027 (for new applications)

• Retroactive Medicaid coverage reduced from 3 months to:

  • 1 month for expansion adults

  • 2 months for all other groups

5. Additional Medicaid Provisions

• Restriction on Funding to Certain Family Planning Providers (Sec. 71113)

  • Effective: July 4, 2025 (for 1 year)

  • Restricts federal funding to certain 501(c)(3) nonprofit providers offering abortions or primary reproductive health services, if they received ≥ $800,000 in Medicaid payments in FY 2023.

• Cap on State Directed Payments in Managed Care

  • Payments capped at:

    • 100% of Medicare rates in expansion states

    • 110% of Medicare rates in non-expansion states

  • Grandfathered payments reduced by 10 percentage points annually starting in 2028.

• Coverage for Noncitizen Aliens

  • Effective: Oct. 1, 2026

  • Medicaid eligibility revoked for qualified aliens who are humanitarian entrants (refugees, asylees, humanitarian parolees).

  • Impact: Estimated 7.5 million people lose coverage by 2034.

Overall Impact

• Total uninsured due to OBBBA (by 2034): ~10 million

  • Includes Medicaid, CHIP, and ACA marketplace coverage losses.