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The Damage Is Already Underway
On July 4, 2025, President Trump signed H.R. 1, the One Big Beautiful Bill Act. The law cuts $911 billion in federal Medicaid spending over ten years. The Congressional Budget Office projects 10 million more Americans will be uninsured by 2034.
This is not a future threat. Multiple provisions took effect in January 2026. More hit this fall. And on May 22, the Trump administration proposed an additional rule to cap state-directed Medicaid payments, which would strip another $775 billion over ten years if finalized.
“The AMA is outraged by the passage of OBBBA, which will cause an estimated 11.8 million people to lose health care coverage.” American Medical Association
Timeline: What’s Already Hit and What’s Coming
| Date | What happens |
|---|---|
| Jan 1, 2026 | Enhanced FMAP for new expansion states sunsets. No more 90% federal match incentive for states that haven’t yet expanded. |
| May 1, 2026 | Nebraska begins enforcing work requirements early. |
| May 22, 2026 | CMS proposes capping state-directed payments at Medicare rates, cutting $510B in federal spending. |
| Jun-Aug 2026 | States must send outreach notices to Medicaid enrollees about work requirements by mail and electronic means. |
| Jul 1, 2026 | Montana enforces work requirements. Arkansas begins checking compliance. |
| Oct 1, 2026 | Emergency Medicaid FMAP drops to the regular state rate for undocumented immigrants. |
| Jan 1, 2027 | All states must enforce 80-hour monthly work requirements for expansion enrollees ages 19-64. |
| Oct 2027 | Provider tax threshold begins dropping 0.5% per year, squeezing state Medicaid budgets through 2032. |
Who Loses Coverage
The CBO estimates the uninsured population will grow by 1.3 million in 2026, 5.2 million by 2027, and 10 million by 2034. The 80-hour monthly work requirement alone accounts for $326 billion in cuts, the single largest source of savings in the bill.
If states drop their ACA Medicaid expansion because the federal match rate falls to their traditional FMAP (ranging from 50% to 77% instead of 90%), as many as 20 million expansion enrollees could lose coverage. That is nearly one in four Medicaid enrollees nationwide.
Arkansas already proved that work requirements do not increase employment. They increase paperwork. One in four Arkansans subject to the 2018 requirement lost coverage. Most of them were already working but could not navigate the reporting system.
Rural Hospitals on the Brink
Independent rural hospitals stand to lose $465 million in patient revenue in 2026 alone. Families USA estimates 55 more rural hospitals will slip into negative net income this year, bringing the total at serious risk of closure to 380.
Congress added a $50 billion Rural Health Fund as a cushion. That sounds like a lot, but it covers only 37% of projected rural Medicaid losses. Since 2020, 117 rural hospitals have already eliminated labor and delivery units because they cannot cover the costs.
What You Can Do
- Tell your senators to block the state-directed payments rule. The CMS proposed rule has a public comment deadline of July 21, 2026. Use Resist Bot to write your members of Congress and demand they intervene.
- Submit a public comment directly to CMS. The Federal Register page accepts comments from anyone. Tell CMS how capping state-directed payments would affect your community’s hospitals and providers.
- Check your state’s work requirement timeline. Nebraska, Montana, Iowa, and Arkansas are moving early. If you’re in an expansion state, contact your state Medicaid office to confirm your enrollment status.
- Call your governor’s office. Governors decide whether their state keeps or drops Medicaid expansion as federal matching funds shrink. Demand they maintain expansion.
- Show up at state budget hearings. State legislatures are deciding right now how to absorb these cuts. Your testimony matters at the local level.
The Bigger Picture
This brief covers the immediate damage from the One Big Beautiful Bill’s Medicaid provisions. For the full context on what’s at stake for American healthcare, including the work requirements experiment that already failed in Arkansas, read our Healthcare and Science hub.