How Could the Trump Administration Medicaid Changes Affect Your Healthcare Coverage?
Key Takeaways
- The budget reconciliation bill signed into law by President Donald Trump in July 2025 will affect health coverage availability and costs.
- Medicaid will have stricter work requirements and more frequent eligibility reviews.
- Some non-citizens who don’t hold Green Cards will be removed from the Medicare rolls.
- There will be new restrictions on subsidized health insurance plans from the Healthcare.gov Health Insurance Marketplace.
On July 4, 2025, President Donald Trump signed the federal statute widely known as the One Big Beautiful Bill Act into law. Passed by the U.S. Congress through a legislative process called budget reconciliation, this measure makes sweeping changes in federal funding such as lowering taxes, expanding work requirements for nutrition assistance, increasing spending on border security, and eliminating tax credits for clean energy.
Some of the provisions that have received the most public attention are the ones that impact Medicaid and other healthcare programs.
The new law modifies who can receive certain benefits and how they must prove eligibility. Even if you’re not currently on Medicaid, Medicare, or a plan purchased from the Health Insurance Marketplace (Heathcare.gov), you should be aware of the impact this legislation may have on your coverage options.
What’s Happening to Medicaid?
Medicaid is jointly administered by the federal government and individual states to provide health insurance coverage for U.S. adults with low incomes. As of March 2025, more than 71 million people were enrolled in the program, partly the result of the expanded eligibility created by the 2010 Affordable Care Act (ACA) and since adopted in 41 states. Under those rules, you can qualify for Medicaid if your household makes up to 138% of the federal poverty level.
The 2025 reconciliation package brings significant changes to Medicaid, including:
- Able-bodied adults under the age of 65 will need to work at least 80 hours a month to receive benefits. There’s an exception for the parents of children who are 13 years old or younger.
- Currently, states only need to review Medicaid beneficiaries’ eligibility for the program once per year. By the end of 2026, states will start renewing eligibility every six months, checking that enrollees have met the work requirements for at least the past month.
- People who are enrolled in Medicaid under the ACA expansion and have an income above the federal poverty line will be required to pay up to $35 in cost sharing for some medical services. There are exemptions for primary care, mental health, and substance use disorder treatment as well as services provided by federally qualified health centers, behavioral health clinics, and rural health clinics.
Find the Medicare Advantage plan that fits your needs.
What About Medicare?
Original Medicare is federally administered health insurance for U.S. adults who are over 65 or have certain disabilities. Medicare operates separately from Medicaid, and the reconciliation bill makes fewer changes to this program. However, the legislation does:
- End Medicare eligibility for people in the U.S. on temporary protected status, refugees and asylees, even if they have met the requirements of working in the country for at least 10 years while paying Medicare payroll taxes. Only U.S. citizens, permanent residents who hold Green Cards, and certain immigrants from a few specific places like Cuba and Haiti will be able to enroll.
- Delay until 2034 the implementation of a Biden-era rule that would make it easier for people with low incomes to qualify for Medicare Savings Programs. Under these initiatives, states help beneficiaries to afford Medicare premiums and out-of-pocket costs.
Health Insurance Marketplace Changes
The reconciliation bill also has measures focused on the insurance plans that private insurance carriers offer through the Healthcare.gov marketplace that was created through the ACA:
- Consumers who are eligible for subsidies to help pay for their coverage will no longer be automatically reenrolled each year. Instead, they will need to meet new verification requirements.
- Healthcare premium tax credits for people who join a plan during certain special enrollment periods will be eliminated.
- Financial protections will be eliminated for people who end up making more money than they estimated when requesting a subsidy to purchase an insurance policy. Now, enrollees may end up fully repaying the tax credits the government sent to their insurance carrier.
When Will I See Changes in My Coverage?
Many of the changes included in the One Big Beautiful Bill Act are designed to be rolled out gradually, so you may not experience the legislation’s effects on your insurance right away.
For example:
- Non-citizens who are no longer eligible for Medicare will lose coverage within 18 months after the law’s enactment.
- The Medicaid work requirements will take effect in most states on December 31, 2026.
- People who are covered through Medicaid Expansion will start paying $35 in cost-sharing for certain medical services on October 1, 2028.
As these changes take effect, review your insurance to confirm that you have coverage that fits your needs and budget. Depending on factors like your age, health conditions, and ZIP code, you may have other options available to you.