This week, the large-scale tax cuts approved by both the House and Senate have significant implications for American healthcare.
Although the legislation heading to President Trump isn’t labeled as a health bill, it represents the most substantial shift in U.S. health policy since the Affordable Care Act (ACA) was enacted in 2010.
The bill impacts patients, healthcare providers, hospitals, and insurers, as Republicans aim to offset costs by cutting over $1 trillion from federal health programs.
Much of the funding reduction will come from Medicaid, introducing changes that will affect eligibility and enrollment for programs assisting over 70 million low-income individuals and Americans with disabilities.
“No matter how often it is repeated, the magnitude of these reductions, and the number of individuals who lose their health insurance, cannot be simply dismissed as waste, fraud or abuse,” stated Rick Pollack, President of the American Hospital Association.
“The faces of Medicaid include children, disabled individuals, seniors, veterans, neighbors, and friends. The actual outcomes of these reductions will negatively impact access to care for all Americans.”
The Congressional Budget Office (CBO) predicts that by 2034, about 12 million low-income Americans could lose their health insurance, undercutting the expanded coverage established by the ACA.
The cuts were substantial enough to raise concerns among Republican lawmakers, yet only two House members and three senators broke ranks to vote against the bill, which ultimately passed with a narrow margin of 51-50 in the Senate and 218-214 in the House.
Here’s a look at how the bill will affect Americans:
Medicaid
The most affected group includes individuals earning between 100% to 138% of the federal poverty level (roughly $32,150 to $42,760 for a family of four) who are insured as part of state Medicaid expansions.
The key change is a new requirement for adults under 65, and low-income children over 14, to verify their work status every six months starting December 2026.
Health advocates caution that an overwhelming number of administrative obstacles could lead to many losing necessary healthcare, even if they are typically qualified.
Republican lawmakers argue that those opposed to Medicaid cuts still benefit from the changes, targeting “healthy” individuals who choose not to work when they could.
Exempt from these new requirements are groups including people with disabilities, pregnant women, and individuals in prisons or rehabilitation centers—entities Republicans consider to be truly vulnerable.
However, individuals claiming exemptions will be required to submit the correct documentation during the Medicaid application process, adding more complexity.
Aside from work requirements, states must begin additional eligibility checks for current Medicaid enrollees starting in 2027.
Those with incomes above the poverty line will need to pay out-of-pocket for several Medicaid services, with some states potentially charging up to 5% of their annual income, while primary care and mental health services will remain exempt from these fees.
The legislation could reduce the number of clinics providing legal abortion services, as it denies federal Medicaid funding for clinics that offer abortions, indirectly targeting planned parenthood without specifically naming it.
According to the organization, nearly 200 planned parent health centers in 24 states might face closures, predominantly in regions where abortion remains legal.
ACA Replacement
The new law complicates the process for individuals trying to enroll in ACA exchanges and secure health plans.
It restricts premium subsidies to U.S. residents not eligible for other federal insurance, preventing most immigrants and legal residents from accessing these financial aids.
Now, real-time eligibility verification will be necessary before individuals can receive grants for premium payments.
In previous practice, those who bought subsidized plans could use them almost immediately; under the new rules, eligibility must be confirmed first.
Essentially, those signing up during special enrollment periods will be ineligible for certain subsidies.
The legislation will also abolish automatic re-enrollment for the 2028 enrollment period, meaning subscribers must annually update their income and immigration status. KFF estimates that 10 million individuals were automatically re-registered in 2025.
Rural and Safety Hospitals
The Republican bill could seriously harm rural hospitals that serve dependent patient populations.
CBO estimates suggest changes in provider tax frameworks could cut spending by around $191 billion over a decade, leading to $58 billion in Medicaid reductions for rural hospitals.
Although the legislation includes a $50 billion rural health relief fund over five years, provider groups argue this is merely a temporary fix compared to the overall cuts.
As a result, hospitals may struggle with crowded emergency rooms and increased reliance on unemployment support.
“Millions of Americans will see health care coverage disappear due to onerous Medicaid work requirements and additional eligibility changes introduced in the bill. Hospitals across the country are becoming unstable, jeopardizing their ability to serve patients effectively. We’re in a crisis,” said one concerned representative.
Moreover, a range of compensation losses combined with the weakening of hospitals could have disastrous effects, and ultimately, patients bear the brunt of these developments.
