House passes reconciliation bill with significant impacts to Medicaid, Health Insurance Marketplaces

The House May 22 passed the fiscal year 2025 budget reconciliation bill, the One Big Beautiful Bill Act by a 215-214 vote. The legislation includes significant impacts to Medicaid and the Health Insurance Marketplaces. 

In a statement shared with Congress and the media last night prior to the vote, AHA President and CEO Rick Pollack said, “Our hospitals and health systems have significant concerns regarding the harmful Medicaid and Health Insurance Marketplace provisions currently included in the bill. The sheer magnitude of the level of reductions to the Medicaid program alone will impact all patients, not just Medicaid beneficiaries, in every community across the nation. Hospitals — especially in rural and underserved areas — will be forced to make difficult decisions about whether they will have to reduce services, reduce staff and potentially consider closing their doors. Other impacts could include longer waiting times to receive care, more crowded emergency departments, and hospitals not being able to invest in technology and innovations for clinical care.

“In particular, the Medicaid legislative proposals severely restrict the use of legitimate state funding resources and supplemental payment programs, including provider taxes and state directed payments, under the guise of eliminating waste, fraud and abuse. We reject this notion as these critical, legitimate and well-established Medicaid financing programs are essential to offset decades of chronic underpayments of the cost of care provided to Medicaid patients. These new policies are estimated to decimate federal support for the Medicaid program by more than $700 billion over 10 years and will displace health care coverage for millions of Americans, moving them from insured to uninsured status.

“In addition to jeopardizing access to patient care and services, these abrupt policy changes would upend state government budgets and threaten the viability of the health care system to provide essential services to this population. Since these changes are effective immediately upon enactment of the legislation, states will have little or no time to prepare for the significant financial impact on state budgets.

“Given the substantial reduction in Medicaid payments and cuts to the Health Insurance Marketplaces, including allowing the enhanced premium tax credits to expire, millions will lose health care coverage. Therefore, the AHA urges the House to reject efforts to dismantle these vital programs in the OBBBA and preserve health care access for our nation’s vulnerable and working families.”

The bill will now be considered by the Senate, where it is likely to undergo a series of changes before a vote is held. 

The AHA sent a Special Bulletin to members that includes the AHA’s statement and highlights changes made to the bill prior to its passage, along with resources to assist with advocacy efforts. A Legislative Advisory was also sent to members that summarizes provisions in the bill impacting hospitals and health systems.