In summary Lower-income people will be the hardest hit. Over the next 10 years, 3.4 million Californians could lose coverage.

The new federal budget signed into law by President Donald Trump is expected to raise some health care insurance premiums and force millions off coverage, reverberating the most in lower-income families and communities that are already struggling.

Trump’s new budget reduces spending for Medicaid — called Medi-Cal in California — by $1 trillion over the next 10 years. These savings would happen in part because new requirements will result in people falling off coverage.

In addition, some people enrolled in Covered California, the state’s marketplace for subsidized health plans, can expect new rules and higher costs, which means more people will be unable to afford the insurance.

Over the next 10 years, the federal changes are estimated to cost the state $28.4 billion and result in 3.4 million Californians losing coverage, according to an estimate from Gov. Gavin Newsom and state health officials.

Less federal funding for Medi-Cal means California will have to make decisions on who is covered and which services are offered. That loss of coverage could be a big blow to California, where lawmakers like to boast about having one of the nation’s lowest uninsured rates.

Alex Rossel, CEO of the community clinic Families Together of Orange County, says as people lose coverage, they’ll get sicker and be left in debt. “All that hard work that clinics have been doing to help people manage their chronic illnesses… is going to be in jeopardy,” he said.

And the effects of these changes could be felt beyond people enrolled in Medi-Cal and Covered California as clinics and hospitals warn that their financial challenges are likely to be exacerbated. Some may have to reduce services or close their doors.

Here are five things to know about how the new federal budget will affect Californians:

Some Medi-Cal enrollees will have work requirements and co-pays

Most notably, the new law requires adults ages 19 to 64 to report at least 80 hours a month of “community engagement,” which could be employment, school or volunteer work.

People who fail to do so will no longer qualify for Medi-Cal. Parents of children 13 and under and people with mental and physical disabilities will be exempt from the work requirements. The new requirement takes effect Dec. 31, 2026, although states could choose to start sooner.

The Urban Institute estimates that this rule alone could force up to 1.4 million Californians off their Medi-Cal insurance in the first year of implementation — not necessarily because they don’t work, but because filing paperwork is likely to pose a challenge for many enrollees. Enrollment counselors say some workers, such as housekeepers and gardeners, don’t have regular paychecks or documentation to prove their employment.

This same group of adults will have to reapply for coverage every six months, instead of once a year. And those who earn more than $15,060 a year, starting in October 2028, may have a co-pay of up to $35 per visit — although the exact amount will be up to states. Some visits will be exempt, such as prenatal and primary care, pediatric care and emergency room visits. (A single adult qualifies for Medi-Cal with an annual income of up to $21,597.)

Higher premiums for Covered California

One of the most significant changes is by omission: The Republican-led Congress opted to not renew some Affordable Care Act subsidies that will expire at the end of this year.

Nearly 90% of Californians who purchase insurance through Covered California, the state’s Affordable Care Act insurance exchange, receive financial assistance from federal subsidies that help lower monthly premiums.

On average, for all enrollees, premiums are expected to increase by 66%, or $101, per month starting next year. Lower-income people will see the biggest premium increase because they receive more subsidies, said Covered California Executive Director Jessica Altman.

Those making less than 400% of the federal poverty level (about $60,240 per year for an individual) are projected to pay an average of $191 more monthly, according to Covered California data.

More than 170,000 middle-income enrollees will lose financial assistance entirely.

Other changes made in Trump’s sweeping budget and policy bill include the elimination of automatic renewal, more income verification requirements and limiting special enrollment periods. The groups most likely to forego coverage because of administrative barriers are those who are young and healthy, Altman said.

Combined, the added enrollment complexities, along with higher out-of-pocket costs, are expected to drive nearly 600,000 Californians off of coverage, according to Covered California projections.

Hospital cuts could impact everyone

When people lose coverage, they are likely to skip routine care; they wait until they are very sick and then visit an emergency room. And without insurance, most people cannot afford to pay their hospital bills.

For hospitals, more uninsured patients means less compensation.

The law also adds new restrictions on provider taxes that states levy on hospitals and insurers to draw down matching federal funds to help pay for Medi-Cal. Hospitals receive payments from the revenue generated by these taxes that help them fill the gaps from traditional reimbursement.

Rural and community hospitals that care for a large share of low-income patients enrolled in Medi-Cal may have an especially difficult time absorbing the losses, so they may have to cut services, reduce staff or close, hospital leaders say.

“Hospitals will be forced to make difficult decisions, and access to vital health care services will be jeopardized for all Californians — not just those who rely on Medi-Cal for their health care coverage,” Carmela Coyle, the president of the California Hospital Association said in a statement.

In a recent press briefing, Newsom noted that a number of hospitals in California have been struggling for some time. In 2023, California rolled out $300 million in interest-free loans to bail out 17 distressed hospitals. The state, currently dealing with a budget deficit, would have a harder time helping hospitals again.

“Those distressed hospital loans came at a time of abundance. Those distressed hospital loans came at a time when we had much more stability with state funds and federal funds, and they were 3x the request for support,” Newsom said.

A funding ban for Planned Parenthood

Effective immediately after Trump signed the bill, Planned Parenthood clinics were banned from receiving federal Medi-Cal payments. Three days later, a federal judge temporarily blocked the funding cut after Planned Parenthood sued.

But as the litigation plays out, advocates say the move could be financially devastating to clinics across the country. In California, a million people use Planned Parenthood clinics each year, and Medi-Cal makes up 80% of its patients.

Federal law already prohibits the use of federal dollars to pay for abortions except in extremely limited instances. But Planned Parenthood does much more than that for patients. While it’s the largest abortion provider in the state, abortions account for less than 10% of its services. Contraceptives, sexually transmitted infection testing and treatment and check ups account for the vast majority of patient visits.

California Planned Parenthood clinics stand to lose more than $300 million, jeopardizing their ability to remain open. The national Planned Parenthood association estimates that 200 clinics across two dozen states are at risk of closure.

All clinics are open and taking patients, said Jodi Hicks, affiliate CEO and president. But the funding cuts could amount to a de facto abortion ban because in many California communities, Planned Parenthood is the only provider that performs abortions.

“People should be angry,” Hicks said. “We will fight back with every tool that we have to ensure that patients are able to be seen at our health centers, but the damage of defunding an entity that has such a large footprint in California is deep.”

Some kids will lose health care and food stamps

The vast majority of health and social services cuts in the federal budget are aimed at adults, but experts say kids will suffer as well. That’s because many of the changes implemented for adults, like work requirements and more frequent income eligibility checks can impact the eligibility of the entire family.

“There are a lot of ways that kids can fall through the cracks,” said Mike Odeh, senior health policy director for Children Now.

About 5.5 million children in California, half of the state’s youths, use Medi-Cal. The state insurance program also pays for some school-based health services, such as counseling and speech therapy.

One of the biggest health cuts targeting children specifically restricts eligibility for the Children’s Health Insurance Program to legal permanent residents, meaning other immigrant children with temporary legal status such as visas or refugee status could not qualify. California already provides health care for all children regardless of immigration status, but the federal prohibition means the state will have to pay more if it wants to continue covering them.

On top of the Medi-Cal cuts, the budget bill makes significant changes to the Supplemental Nutrition Assistance Program, often referred to as food stamps. It institutes stricter work requirements for many adults including veterans and parents of teenagers, ties future spending to inflation and shifts more of the cost-sharing onto states. Similar to the immigration requirement for children’s Medi-Cal, food stamp eligibility will also be restricted to legal permanent residents.

Newsom’s office estimates that 735,000 people will lose food stamps. Early estimates from the Urban Institute project that 3.1 million California families will lose at least some of their food assistance. About a third of all newborns in California are enrolled in food stamp programs, according to the Public Policy Institute of California.

Update, July 3, 2025: The House passed the legislation—along party lines and without a single Democratic vote—that will rip critical health and nutrition programs for millions of Americans. Learn more about the bill’s devastating impact below.

An Overview of the Harmful Budget Bill

Senate Republicans passed a devastating budget bill that would slash Medicaid, Medicare, and SNAP (food assistance) and strip coverage from 17 million Americans to pay for tax cuts that disproportionately benefit high income earners. Because both chambers must pass an identical bill for it to become law, attention then turned to the House. Lawmakers were aiming for final passage by July 4.

The Medicare Rights Center forcefully condemns this legislation and called upon the House to reject it. The bill would strip health coverage from millions, increase out-of-pocket costs, deepen poverty and food insecurity, and destabilize the entire health care system. Its rollbacks represent the biggest cuts to health care and food assistance in history, wiping out recent gains in coverage and outcomes. Older adults, people with disabilities, children, and families with low incomes would be among those most at risk and hardest hit.

The Bill Would Create Harms at an Unprecedented Rate and Scale

Cuts Medicaid by imposing harmful work reporting requirements, increasing enrollee cost sharing, making Medicaid harder to qualify for, enroll in, and keep; eliminating access for many lawfully present immigrants; reducing state financing options; and restricting state payments to hospitals, nursing facilities, and other providers.

Undermines Medicare by stripping coverage away from current enrollees, halting rules that would make nursing homes safer, and reducing beneficiary access to cost-assistance programs (the Medicare Savings Programs and the Part D Low-Income Subsidy) that make coverage, care, and prescription drugs more affordable.

Threatens ACA coverage by eliminating tax credits that help more than 22 million people buy marketplace plans, narrowing sign-up windows, and creating other barriers to enrollment, as well as changing eligibility requirements based on immigration status.

Slashes SNAP benefits by increasing red tape and shifting costs to states, putting food security and healthy eating at risk for millions of older adults, people with disabilities, and children. If states can’t make up for these massive new costs, they would have to cut SNAP eligibility or terminate the program entirely.

Direct Harm to Older Adults and People with Disabilities

Increases Medicare costs for low-income beneficiaries by eliminating key improvements that streamline access to the Medicare Savings Programs (MSP). The nonpartisan Congressional Budget Office (CBO) projects nearly 1.4 million low-income people with Medicare—more than 10% of the dually enrolled Medicare-Medicaid population—would lose their MSP coverage due to the rollback of these simplifications. This would undo years of progress in reducing health and financial insecurity among older adults and people with disabilities.

Lowers Social Security checks by forcing beneficiaries to pay higher Medicare costs. In 2025, without an MSP, enrollees would lose at least $185 per month (the cost of the Part B premium). These financial burdens would grow with time; annual Part B premiums are projected to reach nearly $2,500 in 2026 and more than $4,000 by 2034. Enrollees with very low incomes have even more at stake—they would lose MSP coverage of additional Medicare expenses, like deductibles and copayments. These costs would consume a significant share of limited beneficiary budgets: One case study found that an older couple living on an annual income of $21,000 would pay $8,340 more for Medicare next year.

Makes prescription drug coverage more expensive for low-income Medicare beneficiaries. People with MSPs are automatically enrolled in the Part D Low-Income Subsidy (LIS)/Extra Help, which helps them afford their Medicare prescription drug coverage. The Social Security Administration estimates LIS saves enrollees about $6,200 per year, a number that is likely to rise as drug prices do. Without MSP and its coordination with LIS, beneficiaries would be on the hook for those costs, too.

Imposes harmful Medicaid work reporting requirements by creating a job loss penalty that would apply to individuals up to the age of 64, putting coverage and care at significant risk. CBO finds that at least 5.2 million adults would lose Medicaid, including many who are working or should have an exemption, but who would nevertheless get tripped up by the requirement’s red tape. This provision would likely have a disproportionate impact on the 22 million Medicaid enrollees who are 50 or older, who face outsized barriers to steady employment as well as obstacles to compliance reporting, all while having no impact on overall employment rates.

Puts long-term care at risk by making it harder to qualify for Medicaid coverage and shifting costs to states. This is overwhelmingly likely to result in cuts to Home- and Community-Based Services (HCBS). The bill also effectively repeals the Nursing Home Minimum Staffing Rule, endangering the lives and well-being of thousands of people with Medicare by allowing inadequate nursing facility staffing.

Reduces ACA plan enrollment and affordability by failing to renew the premium tax credits that help more than 22 million people—including many older adults who are not yet Medicare-eligible—afford ACA marketplace plans. As a result, nearly 5 million adults ages 50 to 64 would face higher ACA premiums next year. Those who can’t pay will likely drop their coverage and become uninsured, leading to worse health and higher Medicare costs. Roughly 8 million people who would lose ACA coverage would remain uninsured.

Restricts Medicare and ACA eligibility by terminating Medicare coverage for many individuals with lawful immigration status who have worked and paid taxes in the US for decades. This is a dangerous precedent and a significant departure from current, longstanding policy, which recognizes eligibility for everyone who has paid sufficient Social Security and Medicare taxes. Many would have nowhere to turn for coverage, as the bill would also cut off their access to ACA tax credits. Federal law already restricts Medicaid eligibility for people with lawful status who do not have a green card, but the bill would go even further, penalizing expansion states for using state-only funds to cover noncitizens otherwise ineligible for Medicaid.

Paves the way for bigger Medicare rollbacks by ballooning the national debt. Doing so would trigger massive cuts to Medicare totaling nearly $500 billion. Rising deficits would further jeopardize Medicare’s long-term outlook by creating a funding hole that lawmakers could use as an excuse to pursue future program cuts.

Increases hunger and food insecurity by making significant cuts and changes to SNAP that would threaten access to needed food assistance for lower-income Americans. SNAP helps more than 40 million people purchase the food they need to build and maintain their health. About 10 million SNAP households include at least one adult age 50 or older. Slashing the program would lead to more poverty and worse outcomes.

Massive Coverage Losses and System-Wide Harm

Nonpartisan analysis confirms devastating coverage losses from the bill. The CBO projects roughly 17 million additional people would lose health insurance as a direct result of the bill’s policies. This includes people who are insured through Medicaid, the ACA, and Medicare. Those who maintained coverage would face more onerous administrative requirements, higher costs, reduced services, and less access to care.

Ripple effects on hospitals, providers, and communities from cuts to Medicaid and Medicare would jeopardize hospitals and health clinics—especially in rural communities—likely forcing facility closures, triggering job losses, and destabilizing local economies. These reductions would drive up health care costs for everyone, even people with private insurance.

Job losses across states would skyrocket rapidly. According to recent analysis, in 2029, the bill’s Medicaid and SNAP cuts would cost states $154 billion—18% more than they would save the federal government ($131 billion). Nationwide, 1.22 million jobs would be lost, and state and local tax revenues would drop by $12 billion. Cuts to Medicare and the Marketplace would further disrupt the economy and employment.

Less access to care and higher health risks would lead to more harm and suffering, more preventable deaths, increased reliance on emergency rooms, and worse health outcomes. Research consistently finds that people facing higher out-of-pocket costs for health care cut back on the care they receive, even if it is necessary for their health and safety. This leads to worse health, higher care needs, and more hospitalizations—effects that drive up costs for individuals and system-wide.

More preventable deaths would occur due to reduced access to affordable, high-quality coverage and care. Researchers estimate over 51,000 additional people would die each year if the bill is enacted. This includes 18,200 low-income Medicare-Medicaid enrollees who would lose MSP and LIS. Another 20,000 lives could be lost each year from disenrollments in Medicaid and Marketplace coverage and 13,000 from the rollback of nursing home staffing rules.

Public Opinion is Clear: Americans Oppose These Cuts

Polling consistently shows strong public opposition to the bill. Recent polling echoes previous findings that show widespread, bipartisan concern about cuts to Medicaid and SNAP, and fear that the bill’s policies would limit access to affordable health care and long-term care services. There is also broad opposition to exploding the deficit and cutting taxes for higher-income households. Although the bill’s proponents have obscured its details and impacts, those realities are breaking through—and the more people learn about what it does, the less they like it.

Congress is ignoring the will of the people. The reconciliation bill runs counter to public opinion and ignores the growing demand for stronger—not weaker—health coverage and nutrition assistance.

Este artículo estará disponible en español en El Tiempo Latino.

As the Republican budget bill, called the One Big Beautiful Bill Act, nears the July 4 deadline set by the White House, lawmakers have been ramping up the rhetoric.

Many items in the bill have garnered competing claims from Republicans and Democrats. We’ll lay out what we know about the sometimes disparate interpretations of the bill’s anticipated effects and explain the context around the issues.

Republican Sen. Markwayne Mullin said “the average household of four is going to bring home pay over $10,000 more a year” because of the bill and President Donald Trump said it would be “at least $13,000.” Both appear to be high-end estimates based on optimistic projections for economic growth made by the White House’s own Council of Economic Advisers.

Trump falsely claimed that under the bill “your Medicaid is left alone.” The bill reduces Medicaid spending by hundreds of billions of dollars and establishes new eligibility requirements, changes that are projected to cause millions to lose their health coverage.

Meanwhile, Democratic Sen. Mark Warner exaggerated when he said “this bill will kick about 16 million Americans off of health care.” The Congressional Budget Office estimated that about 11.8 million people would become uninsured in 2034 because of the Senate’s bill.

Democrats and independent analyses said the Senate bill will add at least $3.3 trillion to the federal deficit. The White House said the bill will reduce the deficit by $1.4 trillion. They differ over whether to count an extension of expiring tax cuts as new spending.

Democrats call the bill “tax breaks for billionaires” while Republicans frame it as a tax cut for “working-and-middle class Americans.” Independent analyses indicate that on average, taxpayers in each income group would see some tax relief, though those with the highest incomes would derive the most benefit.

Trump says if the bill passes there would be “no tax on Social Security.” Not exactly. Under the House and Senate versions of the plan, fewer seniors would pay taxes on Social Security benefits, but millions of Americans would still have to pay.

Trump continues to claim that if the bill doesn’t pass, Americans will get a “whopping 68% Tax increase.” According to estimates released by the Joint Committee on Taxation, it would be closer to 10.7%.

The White House claims the bill “unleashes clean, American-made energy, and will reduce the cost of living for Americans nationwide.” However, some analyses indicate it would increase household energy costs.

The bill narrowly passed the Senate on July 1 — with Vice President JD Vance casting the tie-breaking vote — and will now head back to the House for further debate.

Take-Home Pay

In a June 29 interview on NBC’s “Meet the Press,” Republican Sen. Markwayne Mullin said because of the bill “the average household of four is going to bring home pay over $10,000 more a year this year than they did last year.” Days prior, Trump, at a June 26 White House event, said the bill would immediately “increase take-home pay for the normal family of four by at least $13,000.”

But both men appear to be cherry-picking from the high end of an optimistic range of estimates made by the White House’s own Council of Economic Advisers.

In early May, the CEA calculated that under a version of the bill passed by the House Ways and Means committee, take-home pay for a typical family with two children would increase by between roughly $7,800 and about $13,300. Then in late June, when the CEA analyzed a Senate-proposed version of the bill, its estimate of the potential increase in take-home pay for that same-sized family shrunk to a range of between nearly $7,600 and $10,900.

Importantly, both ranges of CEA estimates were based on an assumption that real, or inflation-adjusted, gross domestic product would increase by more than 4% each year, at least for the first four years under the bills. But the nonpartisan Committee for a Responsible Federal Budget labeled those “fantasy growth assumptions” that “are many times higher” than the estimates of other independent analysts that have modeled versions of the bill. The CRFB said that modelers other than the CEA have projected economic growth in the range of 0.1% to 1.3% per year, producing less of an increase in take-home pay for families.

Medicaid Changes

Democrats and Republicans don’t agree on the impact that the bill would have on Medicaid, and both sides have misled the public about what’s predicted to happen if it became law.

At the White House on June 26, Trump claimed that under the bill, “your Medicaid is left alone. It’s left the same.” But as we’ve written, the program would change for millions of people because of provisions that significantly reduce future Medicaid spending and modify eligibility criteria for the program, including new work requirements for adults who gained coverage under a Medicaid expansion in the Affordable Care Act. The CBO estimated that Medicaid provisions in the House version of the bill would cause 7.8 million to lose their coverage in 2034, with the majority, 5.2 million, expected to lose Medicaid due to the work requirements.

For our previous story, health care experts told us that many beneficiaries would likely have problems submitting the required paperwork to prove their eligibility, leading to people being dropped from the Medicaid rolls. And, experts said, not all of the people losing coverage would be able-bodied adults refusing to work, as some Republicans have claimed.

Meanwhile, Democrats have exaggerated the number of people that the CBO has estimated would lose health insurance because of the bill. For example, Sen. Mark Warner, in a June 29 interview on CNN’s “State of the Union,” said, “this bill will kick about 16 million Americans off of health care,” a figure he attributed to “the independent referees, CBO and others.”

But the CBO said that the House version would result in 10.9 million more people becoming uninsured in 2034, including current Medicaid beneficiaries and people who now get their health insurance through the ACA marketplaces. And, more recently, the CBO estimated that the Senate version of the bill would lead to 11.8 million losing health insurance in 2034 – although there was no breakdown by the type of coverage lost. The higher figure cited by Warner and other Democrats includes millions of estimated losses under a separate matter — the scheduled expiration in 2025 of ACA premium tax credits that were last extended in 2022. What happens to those previously expanded tax credits is still up in the air, but their extension is not directly tied to the bill under consideration by Congress.

Calculating the Deficit Impact

Democratic Sen. Amy Klobuchar said the Senate bill will raise federal deficits by $4 trillion, while the White House said it will cut the deficit by $1.4 trillion. The clash over the deficit projections comes down to different interpretations of how the 2017 Tax Cuts and Jobs Act affects the bottom line.

The CBO has said the bill passed by the Senate will add at least $3.3 trillion to the national debt over the next 10 years, taking into account the extension of the 2017 tax cuts championed by Trump. The Committee for a Responsible Federal Budget estimated the Senate bill will increase the federal debt by more than $3.9 trillion through 2034.

“Congressional Republicans betrayed the American people, passing a bill that will raise our debt by $4 trillion,” Klobuchar said in a July 1 statement shortly after the bill’s passage in the Senate.

The Senate bill includes $4.5 trillion in tax cuts — extending the lower rates passed in 2017 and adding new tax cuts. But Senate Republicans have taken steps to remove consideration of the 2017 tax cuts in determining the bill’s impact on the deficit. Republican Sen. Bill Hagerty, who was presiding over the Senate in April, ruled that Sen. Lindsey Graham, the Senate Budget Committee chair, had the sole authority to decide whether extending the 2017 tax cuts officially adds to the deficit.

Graham and like-minded Senate Republicans have said that because the tax cuts have been in effect and are “current policy,” they are not new and do not add to future deficits.

A June 7 memo from the White House argued that Republicans in Congress would certainly extend the 2017 tax cuts and “an honest portrayal of current future deficits adjusts for the continuation” of the cuts. “On its own, the OBBB reduces the deficit by over $1.4 trillion. Net mandatory savings of $1.7 trillion are partly offset by increases in one-time spending to finally and fully secure the border to defend our Nation from invasion, and to lower taxes from policies such as no tax on tips or overtime that are partly offset with loophole closers in the tax code. The net deficit reduction totals $1.407 trillion,” the White House said.

Democratic Sen. Jeff Merkley, the ranking member of the Senate Budget Committee, objected to granting Graham the power to determine how to account for the existing tax cuts. “The ability of the chair to create a phony baseline has never been used in reconciliation, not ever,” Merkley said.

Senate Minority Leader Chuck Schumer, Merkley and Ron Wyden, ranking member of the Senate Finance Committee, sent a letter on March 31 to the Senate Republican leadership saying, “As Members of your conference advocate for the use of budget fraud – the so-called ‘current policy baseline’ – in an attempt to make a second round of Trump Tax giveaways look like it would cost $0, rather than the true $37 trillion over 30 years, we write today to remind you that employing this unprecedented gimmick would upend budget law, erode the remaining fiscal guardrails in the budget reconciliation process, and result in trillions of dollars more in federal debt.”

Taxpayers for Common Sense also criticized the Republican maneuver on assessing the bill’s impact on the deficit in a July 1 statement. “Reconciliation was supposed to be Congress’s tool for fiscal discipline. Instead, senators are using ‘current policy’ scoring — a fancy term for pretending that temporary tax cuts are permanent fixtures — to hide trillions in costs from the American people. It’s the legislative equivalent of cooking the books,” the nonpartisan watchdog group said.

Benefits for Billionaires or the Middle Class?

The difference in the rhetoric surrounding who would benefit from the bill’s tax cuts is stark: Democrats say the bill is a boon for billionaires; Republicans frame it as a tax cut for “working-and-middle class Americans.” Both sides are spinning the facts a bit.

Independent analyses indicate that a majority of taxpayers in each income category would see some tax relief, though those with the highest incomes would derive the most benefit.

In the lead-up to the Senate vote, Democrats claimed that cuts to safety net programs were made in service of tax breaks to the very wealthy.

“Why are they doing all this? We know why. Tax breaks for billionaires,” Senate Democratic Leader Chuck Schumer said from the Senate floor on June 28.

“This is just so Republicans can give a big tax cut to the wealthiest Americans,” Democratic Sen. Mark Kelly said on MSNBC on June 30.

Meanwhile, Republican Sen. Jim Banks on “Fox News Sunday” on June 29 called the bill “the biggest tax cut in American history for working class families.”

The White House also put out a release pushing back against the “myth” that the bill “takes from the poor to give to the rich.”

“Low-income workers stand to receive the largest percentage reduction in their tax liability,” the White House said. “One Big Beautiful Bill delivers the largest tax cut in history for working-and-middle class Americans.”

As we have written, on average, taxpayers in every income group would get some tax relief if the 2017 tax cuts are permanently extended. But not everyone. In all, about two-thirds to three-quarters of taxpayers would get a tax cut, according to independent analyses. Also, the cuts skew in favor of wealthy Americans, who would see more tax relief not only in the dollar amount, but as a percentage of income, on average.

(For clarity, people would experience an extension of the 2017 tax law not as a new tax cut, but as the absence of a tax increase if the provisions were allowed to expire.)

The Tax Foundation, for instance, concluded, based on the version of the bill passed by the Senate Finance Committee, and accounting for the economic growth expected to be spurred by the bill, that the percentage change in after-tax income increases — on average – as income rises. For example, in 2034, those in the bottom 20% of earners are expected to see a 0.5% increase in after-tax income. That percentage increases to 2.6% for the next 20% of earners. Those with incomes in the middle 20% — who earn between $38,572 and $73,905 — would see a 3.5% increase in after-tax income in 2034. The largest increase — 3.7% — would accrue to those in the top 20%, the Tax Foundation said.

Based on its analysis of the Senate Budget Committee version of the bill released on June 28, the Urban-Brookings Tax Policy Center wrote, “Average tax cuts are generally larger as a percentage of after-tax income for higher income households than for lower income households, and nearly 60 percent of the tax benefits would go to those in the top quintile (with incomes of about $217,000 or more).”

The Penn Wharton Budget Model looked at the effect of the Senate version of the bill on lifetime income, and factored in the effect of cuts to Medicaid and food assistance. Using a model that takes into account the expected economic growth from the plan, the PWBM found, “that households most affected by the cuts to Medicaid and SNAP — those in the bottom income quintile — experience the largest losses under this bill, averaging $27,500 in lifetime value for the working-age population. In contrast, working-age households in the top income quintile generally benefit from lower taxes, gaining an average of more than $65,000. Working-age households in the middle of the income distribution are largely unaffected, with an average lifetime gain of less than $500, as they face a chance of needing spending programs that have been reduced, but also benefit from some of the tax cuts.

“All future generations are projected to experience lifetime losses under the bill, ranging from $5,700 for high-income households to $22,000 for low-income households,” the PWBM found. “The losses for lower-income groups are primarily driven by a reduced social safety net and lower wages associated with a lower capital stock, while losses for top-income groups are entirely the result of lower wages.”

Taxes on Social Security Benefits

In a Fox News interview on June 29, Trump again claimed — as he has repeatedly — that if the bill passes there would be “no tax on Social Security.” Not exactly. Under the House and Senate versions of the plan, fewer seniors would pay taxes on Social Security benefits, but not everyone would be exempt.

The version of the bill passed by the Senate would add a $6,000 tax deduction for seniors age 65 and older ($12,000 for married seniors) beginning in 2025 and through 2028 — regardless of whether they receive Social Security benefits. (See Sec. 70103) The House version of the bill proposes a $4,000 deduction for seniors though 2028. (See Sec. 110103)

According to the White House’s Council of Economic Advisers, 64% of seniors aged 65 and over who receive Social Security income already receive exemptions and deductions that exceed their taxable Social Security income. So, already, most seniors do not pay taxes on their Social Security income.

Under the more generous Senate version of the bill, an additional 14.2 million would have exemptions and deductions exceeding their taxable Social Security income, so that, in effect, 88% of seniors would not pay any taxes on their Social Security income, according to CEA. The senior deduction would start to decline for individuals with incomes of more than $75,000 and couples with incomes of more than $150,000, and would disappear entirely for individuals making over $175,000.

So, the Senate version of the bill would dramatically reduce the number of seniors who pay taxes on Social Security benefits. But it wouldn’t eliminate taxes on Social Security entirely. According to the CEA’s own analysis, more than 7 million seniors with higher incomes would still pay taxes on Social Security benefits.

Trump’s Unfounded 68% Tax Increase Warning

Over the last week, the president has repeated an unfounded claim he’s been making since April — warning that if this bill doesn’t pass, there will be a “whopping 68% Tax increase.”

We’ve not been able to find any analysis of the bill that supports that claim, and the White House didn’t answer our question asking for an explanation of how it was calculated.

White House spokeswoman Abigail Jackson did, however, tell us that the talking point reflected the impact of not “ending taxes on tips, overtime, and Social Security,” as proposed in the bill. And Trump has said that it also includes the effect of not extending certain provisions from the 2017 Tax Cuts and Jobs Act that are set to expire this year.

Trump, June 27: Well, it comes from the fact that you have automatically the Trump cuts, which were the biggest cuts that we’ve ever had. Now, these cuts are even bigger. But from the last administration we had the Trump cuts. … And that alone is a big chunk of the 68%. And then you have the other taxes that would accumulate. And they say that you’d have about a 68% tax increase.

But those things don’t add up to a 68% tax increase.

“By far the largest part of the bill is extending the expiring tax cuts,” said Joseph Rosenberg, a senior fellow at the Urban Institute who researches federal tax issues at the Urban-Brookings Tax Policy Center.

As we’ve written before, the TPC has estimated that, on average, Americans’ taxes would rise about 7.5% if those 2017 tax cuts aren’t extended at the end of the year.

“Everything else is not going to close the gap,” he said, referring to adding in the proposed changes in taxes on tips, overtime and Social Security to reach a 68% rise in taxes.

Rosenberg pointed to estimates released by the Joint Committee on Taxation on July 1, showing that the total change in new tax-cut provisions in the bill approved by the Senate is 3.5% and the total including the extension of the 2017 tax cuts is 10.7%, which is a far cry from the 68% claimed by Trump.

Energy Costs

A June 29 White House release claimed that the bill “unleashes clean, American-made energy, and will reduce the cost of living for Americans nationwide.” However, some analyses indicate it would increase household energy costs.

The bill quickly phases out tax credits for wind and solar power projects and electric vehicles enacted under the Inflation Reduction Act, President Joe Biden’s signature climate law, and imposes materials sourcing requirements for clean energy projects. The bill keeps longer-term tax credits for some types of zero-emissions energy projects, such as geothermal, nuclear and hydropower, while expanding oil drilling leases, among other energy-related provisions.

A new analysis by Energy Innovation, a nonpartisan think tank focused on energy and climate policy, found that the bill would result in $170 in additional annual energy costs per household in 2035, on average, compared with the alternate scenario where energy policy remained the same.

“Our modeling found that any decrease in fossil fuel prices from increased fossil fuel production is way more than offset by higher electricity costs with the net costs of energy to households and businesses rising dramatically,” Robbie Orvis, senior director of modeling and analysis at Energy Innovation, told us in an email.

A different analysis from the REPEAT Project, led by Princeton University energy systems engineer Jesse Jenkins, projects that the current Senate bill would increase average annual household energy costs by $284 per household by 2035.

Jenkins told us in an email that analyses show the bill “will reduce investment in new clean American energy sources, particularly wind and solar power (the most important and fastest growing sources of clean energy in America) and increase electricity prices and household energy costs.”

When asked for an analysis or other evidence that the bill would reduce costs for Americans, the White House pointed to gasoline prices that are expected to hit four-year lows for the Fourth of July holiday.

“Since taking office, President Trump has unleashed an American energy revolution that has driven down costs – with gas prices currently the lowest they’ve been since 2021 – and brought jobs back to the United States,” Abigail Jackson, a White House spokesperson, told us in an email. “President Trump’s One, Big, Beautiful Bill will supercharge that growth and continue to lower costs for all Americans.”

Other backers of the policy, including conservative-aligned energy nonprofits, have argued the clean energy incentives are unnecessary expenditures with the potential to harm the electrical grid.

“We got to pass the One Big Beautiful Bill so we can stop wasting money on unreliable, intermittent energy,” Energy Secretary Chris Wright said in a video posted to X on June 26, adding that the bill will lower costs by removing “the barriers and shackles that are on the core sources of energy.”

The U.S. is already at record-level energy production. According to the U.S. Energy Information Administration, the U.S. produced more energy than ever before in 2024, with natural gas accounting for 38% of total production and crude oil for 27%.

Experts previously told us that while increasing production of fossil fuels could lower prices somewhat temporarily, it is unlikely to move the needle much long-term. Oil is a global commodity, and companies will pull back on production if the price of oil falls too low. And producing natural gas for export could raise prices for Americans.

Earlier in June, Trump posted on his social media platform Truth Social that he did not want any tax credits for clean energy, calling them “largely a giant SCAM.” He also said wind power is the “most expensive and inefficient energy in the world.” But as we’ve written, that’s not true.

As for the notion that the bill will still support energy that is “clean,” burning fossil fuels in the U.S. is often cleaner than doing so elsewhere in the world. But swapping out renewables such as wind and solar for fossil fuels in the U.S. will result in more heat-trapping carbon emissions and other pollutants harmful for the environment and human health.

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U.S. uninsured rates could resurge if Trump’s budget bill passes

toggle caption Lynsey Weatherspoon for KFF Health News

CLARKESVILLE, Ga. — Last September, Alton Fry went to the doctor concerned he had high blood pressure. The trip would result in a prostate cancer diagnosis.

So began the stress of trying to pay for tens of thousands of dollars in treatment — without health insurance.

“I’ve never been sick in my life, so I’ve never needed insurance before,” said Fry, a 54-year-old self-employed masonry contractor who restores old buildings in the rural Appalachian community he’s called home nearly all his life.

Making sure he had insurance was the last thing on his mind, until recently, Fry said. He had been rebuilding his life after a prison stay, maintaining his sobriety, restarting his business, and remarrying his wife. “Things got busy,” he said.

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Now, with a household income of about $48,000, Fry and his wife earn too much to qualify for Georgia’s limited Medicaid expansion. And he said he found that the health plans sold on the state’s Affordable Care Act exchange were too expensive or the coverage too limited.

In late April, a friend launched a crowdfunding campaign to help Fry cover some of the costs. To save money, Fry said, he’s taking a less aggressive treatment route than his doctor recommended.

“There is no help for middle-class America,” he said.

More than 26 million Americans lacked health insurance in the first six months of 2024, according to the Centers for Disease Control and Prevention.

The uninsured are mostly low-income adults under age 65, and people of color, and most live in the South and West. The uninsured rate in the 10 states that, like Georgia, have not expanded Medicaid to nearly all low-income adults was 14.1% in 2023, compared with 7.6% in expansion states, according to KFF, a health information nonprofit that includes KFF Health News.

Health policy researchers expect the number of uninsured to swell as the second Trump administration and a GOP-controlled Congress try to enact policies that explicitly roll back health coverage for the first time since the advent of the modern U.S. health system in the early 20th century.

Under the “One Big Beautiful Bill Act” — budget legislation that would achieve some of President Donald Trump’s priorities, such as extending tax cuts mainly benefiting the wealthy — some 10.9 million Americans would lose health insurance by 2034, according to estimates by the nonpartisan Congressional Budget Office based on a House version of the budget bill.

A Senate version of the bill could result in more people losing Medicaid coverage with reductions in federal spending and rules that would make it harder for people to qualify. That bill suffered a major blow Thursday when the Senate parliamentarian, a nonpartisan official who enforces the chamber’s rules, rejected several health provisions — including the proposal to gradually reduce provider taxes, a mechanism that nearly every state uses to increase its federal Medicaid funding.

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The number who could lose insurance could rise to 16 million if proposed rule changes to the ACA take effect and tax credits that help people pay for ACA plans expire at the end of the year, according to the CBO. In KFF poll results released in June, nearly two-thirds of people surveyed viewed the bill unfavorably and more than half said they were worried federal funding cuts would hurt their family’s ability to obtain and afford health care.

Like Fry, more people would be forced to pay for health expenses out-of-pocket, leading to delays in care, lost access to needed doctors and medications, and poorer physical and financial health.

“The effects could be catastrophic,” said Jennifer Tolbert, deputy director of KFF’s Program on Medicaid and the Uninsured.

A patchwork system

The House-passed bill would represent the largest reduction in federal support for Medicaid and health coverage in history, Tolbert said. If the Senate approves it, it would be the first time Congress moved to eliminate coverage for millions of people.

“This would take us back,” she said.

The United States is the only wealthy country where a substantial number of citizens lack health insurance, due to nearly a century of pushback against universal coverage from doctors, insurance companies, and elected officials.

“The complexity is everywhere throughout the system,” said Sherry Glied, dean of New York University’s Wagner School of Public Service, who worked in the George H.W. Bush, Clinton, and Obama administrations. “The big bug is that people fall between the cracks.”

This year, KFF Health News is speaking to Americans about the challenges they face in finding health insurance and the effects on their ability to get care; to providers who serve the uninsured; and to policy experts about why, even when the nation hit its lowest recorded uninsured rate in 2023, nearly a tenth of the U.S. population still lacked health coverage.

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So far, the reporting has found that despite decades of policies designed to increase access to care, the very structure of the nation’s health insurance system creates the opposite effect.

Government-backed universal coverage has eluded U.S. policymakers for decades.

After lobbying from physician groups, President Franklin D. Roosevelt abandoned plans to include universal health coverage in the Social Security Act of 1935. Then, because of a wage and salary cap used to control inflation during World War II, more employers offered health insurance to lure workers. In 1954, health coverage was formally exempted from income tax requirements, which led more employers to offer the benefit as part of compensation packages.

toggle caption Whit Sides/Cover Alabama

Insurance coverage offered by employers came to form the foundation of the U.S. health system. But eventually, problems with linking health insurance to employment emerged.

“We realized, well, wait, not everybody is working,” said Heidi Allen, an associate professor at the Columbia School of Social Work who studies the impact of social policies on access to care. “Children aren’t working. People who are elderly are not working. People with disabilities are not working.”

Yet subsequent efforts to expand coverage to all Americans were met with backlash from unions who wanted health insurance as a bargaining chip, providers who didn’t want government oversight, and those who had coverage through their employers.

That led policymakers to add programs piecemeal to make health insurance accessible to more Americans.

There’s Medicare for older adults and Medicaid for people with low incomes and disabilities, both created in 1965; the Children’s Health Insurance Program, created in 1997; the ACA’s exchange plans and Medicaid expansion for people who can’t access job-based coverage, created in 2010.

As a result, the U.S. has a patchwork of health insurance programs with numerous interest groups vying for dollars, rather than a cohesive system, health policy researchers say.

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Falling through the cracks

The lack of a cohesive system means even though Americans are eligible for health insurance, they struggle to access it, said Mark Shepard, an associate professor of public policy at the Harvard Kennedy School of Government. No central entity exists in the U.S. to ensure that all people have a plan, he said.

Over half of the uninsured might qualify for Medicaid or subsidies that can help cover the costs of an ACA plan, according to KFF. But many people aren’t aware of their options or can’t navigate overlapping programs — and even subsidized coverage can be unaffordable.

Those who have fallen through the cracks said it feels like the system has failed them.

Yorjeny Almonte of Allentown, Pennsylvania, earns about $2,600 a month as an inspector in a cabinet warehouse. When she started her job in December 2023, she didn’t want to spend nearly 10% of her income on health insurance.

But, last year, her uninsured mom chose to fly to the Dominican Republic to get care for a health concern. So Almonte, 23, who also needed to see a doctor, investigated her employer’s health offerings. By then she had missed the deadline to sign up.

“Now I have to wait another year,” she said.

In January, Camden, Alabama, resident Kiana George, who’s uninsured, landed in an intensive care unit months after she stopped seeing a nurse practitioner and taking blood pressure medications — an ordeal that saddled her with nearly $7,000 in medical bills.

George, 30, was kicked off Medicaid in 2023 after she got hired by an after-school program. It pays $800 a month, an income too high to qualify her for Medicaid in Alabama, which hasn’t expanded to cover most low-income adults. She also doesn’t make enough for a free or reduced-cost ACA plan.

George, who has a 9-year-old daughter, said she “has no idea” how she can repay the debt from the emergency room visit. And because she fears more bills, she has given up on treatment for ovarian cysts.

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“It hurts, but I’m just gonna take my chances,” she said.

Debating the high cost of care

Researchers have known for decades that a lack of insurance coverage leads to poor access to health care, said Tom Buchmueller, a health economist at the University of Michigan Ross School of Business.

“It’s only more recently we’ve had really good, strong evidence that shows that health insurance really does improve health outcomes,” Buchmueller said.

Research released this spring by the National Bureau of Economic Research found that expanding Medicaid reduced low-income adults’ chances of dying by 2.5%. In 2019, a separate study published by that nonpartisan think tank provided experimental evidence that health insurance coverage reduced mortality among middle-aged adults.

In late May, the House narrowly advanced the budget legislation that independent government analysts said would result in millions of Americans losing health insurance coverage and reduce federal spending on programs like Medicaid by billions of dollars.

A key provision would require some Medicaid enrollees to work, volunteer, or complete other qualifying activities for 80 hours a month, starting at the end of 2026. Most Medicaid enrollees already work or have some reason they can’t, such as a disability, according to KFF.

House Speaker Mike Johnson has defended the requirement as “moral.”

“If you are able to work and you refuse to do so, you are defrauding the system. You’re cheating the system,” he told CBS News in the wake of the bill’s passage.

A Senate version of the bill also includes work requirements and more frequent eligibility checks for Medicaid recipients.

Fiscal conservatives argue a solution is needed to curb health care’s rising costs.

The U.S. spends about twice as much per capita on health care than other wealthy nations, and that spending would grow under the GOP’s budget bill, said Michael Cannon, director of health policy studies at the Cato Institute, a think tank that supports less government spending on health care.

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But the bill doesn’t address the root causes of administrative complexity or unaffordable care, Cannon said. To do that would entail, for instance, doing away with the tax break for employer-sponsored care, which he said fuels excessive spending, high prices, and ties health insurance to employment. He said the bill should cut federal funding for Medicaid, not just limit its growth, to reduce excessive health care prices and spending.

The bill would throw more people into a high-cost health care landscape with little protection, said Aaron Carroll, president and CEO of AcademyHealth, a nonpartisan health policy research nonprofit.

“There’s a ton of evidence that shows that if you make people pay more for health care, they get less health care,” he said. “There’s lots of evidence that shows that disproportionately affects poor, sicker people.”

Labon McKenzie, 45, lives in Georgia, the only state that requires some Medicaid enrollees to work or complete other qualifying activities to obtain coverage.

He hasn’t been able to work since he broke multiple bones after he fell through a skylight while on the job three years ago. He got fired from a county road and bridge crew after the accident and hasn’t been approved for Social Security or disability benefits.

“I can’t stand up too long,” he said. “I can’t sit down too long.”

In February, McKenzie started seeing double, but canceled an appointment with an ophthalmologist because he couldn’t come up with the $300 the doctor wanted in advance. His cousin gave him an eye patch to tide him over, and, in desperation, he took expired eye drops his daughter gave him. “I had to try something,” he said.

McKenzie, who lives in rural Fort Gaines, wants to work again. But without benefits, he can’t get the care he needs to become well enough.

“I just want my body fixed,” he said.

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KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF.

A nurse gives a patient a checkup at an Oakland, California, clinic in 2017. (Carlos Avila Gonzalez/The San Francisco Chronicle via Getty Images)

Medicaid, the joint federal-state health insurance program that covers about one-in-five Americans, may be in for some of the biggest changes in its 60-year history.

The tax, spending and policy bill making its way through Congress seeks to cut hundreds of billions of dollars from Medicaid over the next decade to help offset the measure’s even larger tax cuts. The Congressional Budget Office estimates that the Medicaid cuts, along with changes to other federal insurance programs, would lead to millions of people losing health coverage should the bill become law.

Given the changes that may be in store for the program and its overall complexity, here are answers to some common questions about Medicaid.

What is Medicaid?

Medicaid provides health insurance to various categories of low-income people. It’s funded jointly – though not equally – by the federal government and the states. However, the way the program is structured and run means that in many ways there’s no single Medicaid program. Rather, there are 56: one for each state, the District of Columbia and the five permanently inhabited U.S. territories.

Medicaid was created in 1965 at the same time as Medicare, the federal health insurance program primarily for people ages 65 and older. Both programs are overseen by the Centers for Medicare & Medicaid Services (CMS), an agency within the U.S. Department of Health and Human Services.

The Children’s Health Insurance Program (CHIP), created in 1997, is designed to cover children from families whose incomes are modest but too high to qualify for Medicaid. While CHIP is formally separate from Medicaid, the two programs are closely coordinated in practice. In fact, some states administer CHIP as an extension of their Medicaid programs, while others either operate CHIP separately or combine the two approaches. This analysis will present data for Medicaid and CHIP separately when possible.

Medicaid is broadly popular. More than eight-in-ten U.S. adults (83%) have a favorable opinion of the program, according to a recent survey by KFF, a nonpartisan research organization focused on health policy. That view is shared by 93% of Democrats, 74% of Republicans and 83% of independents.

Is Medicaid eligibility determined by the federal government or the states?

Both. The federal government sets general rules about who always qualifies for Medicaid and which health care services must be covered. Beyond that, states have considerable flexibility to determine the scope of their programs by extending eligibility to additional groups of people (or not) and covering various optional health care services (or not).

For example, under the federal Affordable Care Act of 2010, states can expand eligibility to adults with household incomes up to 138% of the federal poverty level – which in 2025 would be $44,367 for a family of four – with the federal government picking up 90% of the additional cost. Forty states and D.C. have expanded their Medicaid programs in this way, while the other 10 states have not.

Who’s eligible for Medicaid?

Originally, Medicaid was aimed at certain categories of low-income people: families with children, pregnant women, and the elderly, blind or disabled. People in those groups who received some form of public assistance generally also qualified for Medicaid coverage.

Those eligibility groups have broadened over time. States are required to cover some groups – for instance, children in foster care and former foster care youth up to age 26. Coverage is optional for others – for example, pregnant women and infants in households with incomes between 133% and 185% of the federal poverty level. Since each state sets its own eligibility criteria (within broad federal minimums), there’s no simple way to summarize them.

In fiscal year 2022, 36% of all Medicaid enrollees were children, according to the Medicaid and CHIP Payment and Access Commission. Another 26% were adults who had become eligible under the 2010 Affordable Care Act; 18% were adults who’d already been eligible; and 20% were elderly, blind or disabled.

How many people have Medicaid coverage?

As of January 2025, 71.4 million people were enrolled in Medicaid, according to preliminary CMS data. An additional 7.3 million were enrolled in CHIP. Together, the two programs covered nearly 41.4 million adults and 37.4 million children, or 23% of the U.S. population.

Children are covered by Medicaid at a higher rate than adults. We estimate that 41% of all U.S. children were enrolled in Medicaid and 10% were enrolled in CHIP as of January. The two programs combined provided health coverage to more than half of the country’s 73.1 million children. By comparison, Medicaid enrolled 15% of the U.S. adult population as of January.

How has Medicaid enrollment changed over time?

While the long-term trend has been upward, Medicaid enrollment has remained relatively steady for the past several years at around 20% of the U.S. population.

Medicaid enrollment counts are affected by factors including population growth and general economic conditions, since more people become eligible in downturns as they lose jobs and income. But policy changes play a significant role as well: Congress and individual states can expand or restrict eligibility rules and, separately, make it easier or harder for people to enroll and maintain their eligibility status.

During the COVID-19 pandemic, for example, Congress gave states extra money for their Medicaid programs on the condition that they maintain coverage for nearly everyone who was already enrolled in the program (rather than periodically rechecking their eligibility, as is normally required). This “continuous coverage” rule led to a steep rise in enrollment, from 64.8 million in March 2020 to a peak of 87.4 million in April 2023 – an increase of 34.8%.

The extra funds began to phase out in April 2023 and ended completely, along with the continuous coverage requirement, that December. Medicaid enrollment has fallen steadily since then, to 21% of the U.S. population as of January 2025.

How do Medicaid enrollment rates vary around the country?

In January 2025, by our calculations, Medicaid enrollment ranged from a high of 34.2% of the population in D.C. to a low of 8.6% in Utah. Enrollment in CHIP ranged from 4.4% in Oregon to 0.1% in Minnesota. Again, state enrollment rates in these programs depend on factors including local economic conditions and each state’s eligibility rules.

Detailed table: Medicaid enrollment by state in January 2025

What are the demographics of Medicaid enrollees?

Here’s some of what we know, based on 2023 data from the Current Population Survey’s Annual Social and Economic Supplement, or ASEC. (Note that ASEC defines Medicaid to include CHIP and a handful of other state-administered programs for low-income people.)

Women account for just over half of Medicaid enrollees (52.2%), slightly higher than their share of the overall U.S. population (50.7%).

Non-Hispanic White enrollees account for 39.6% of all Medicaid recipients (versus 58.0% of the U.S. population as a whole). Hispanic people, who can be of any race, comprise 30.8% of enrollees (versus 19.7% of the population), and Black people make up 20.8% of enrollees (versus 13.5% of the population). The share of Asian American enrollees (6.0%) was about the same as their share of the overall population (6.6%).

Medicaid enrollees ages 19 to 64 are more likely than Americans in that age group overall to have never been married (47.9% vs. 36.3%) or to be divorced or separated (14.8% vs. 11.1%). They’re much less likely than Americans overall to be currently married (34.9% vs. 51.0%).

Nearly half of enrollees (48.6%) have household incomes of less than $50,000, compared with 23.8% of the general population.

More than half (57.2%) of enrollees ages 26 to 64 have a high school diploma or less, compared with 34.9% of the population in that age group.

17.0% of enrollees rate their health status as “fair” or “poor,” compared with 11.2% of all people surveyed.

84.2% of Medicaid enrollees were born in the United States, 6.6% are naturalized citizens and 9.2% are foreign-born noncitizens. Those shares are all similar to the U.S. population as a whole. Only some noncitizens are eligible for Medicaid; unauthorized immigrants are not eligible for the program.

Are Medicaid enrollees required to work?

In most cases, no. But under the budget legislation pending in Congress, people who qualify for Medicaid under the 2010 Affordable Care Act expansion would have to work, do community service or go to school to retain their eligibility. (Georgia operates a pilot work requirement under a waiver approved during the first Trump administration.)

In a recent Pew Research Center survey, 49% of U.S. adults said they would favor work requirements for most adults who get health insurance through Medicaid, while 32% would oppose such requirements and 18% weren’t sure.

Most working-age adult enrollees in Medicaid already work, according to a May 2025 analysis by KFF.

Just over 31.2 million people ages 19 to 64 were enrolled in Medicaid in 2023, KFF found. More than 2.4 million of them were also covered by Medicare, and 2.7 million received disability benefits from Social Security or Supplemental Security Income benefits. Excluding those two groups of people, who presumptively have disabilities that would exempt them from the work requirements, leaves 26.1 million enrollees. Among that group, 11.5 million worked full time (44.1%) and 5.1 million worked part time (19.5%).

Of the 9.5 million people who didn’t work, 3.2 million cited caregiving responsibilities as a reason, while 1.7 million said they were in school and 2.6 million cited illness or disability.

How much does Medicaid cost?

In fiscal 2023, the most recent year for which detailed financial information is available, Medicaid’s net cost was $894.2 billion. The federal government paid just over two-thirds of that figure ($614.0 billion, or 68.7%), while states, D.C. and territories paid the rest ($280.2 billion, or 31.3%).

Under Medicaid, states pay health care providers up front. The federal government then reimburses states for part of those costs. Those federal payments are a lot larger in some states than others. In fiscal 2023, for example, the federal government paid for 82.1% of New Mexico’s program, 71.0% of Tennessee’s and 59.7% of Wyoming’s. The federal shares of the territories’ programs were all 85% or higher.

The federal matching rates vary because they’re based largely on each state’s per-capita income and are recalculated each year based on new data. In addition, certain services and subgroups of enrollees are reimbursed at their own specific rates.

Historically, the federal government’s overall share of Medicaid costs has hovered between 56% and 59%, though Congress has often raised matching rates temporarily during economic downturns.

The federal share rose above 60% and stayed there after the Affordable Care Act expanded Medicaid eligibility. During the COVID-19 pandemic, when Congress authorized extra payments to states for retaining people on the rolls, the federal share reached as high as 71% (in fiscal 2022).

How much of federal and state budgets go to Medicaid?

In fiscal 2024, Medicaid represented about 8% of all federal spending, according to archived data from the Office of Management and Budget. This was down from a peak of 10% the year before. Medicaid’s share of federal spending grew steadily from the program’s inception until the 2004 fiscal year, and since then it has bounced around more erratically.

State spending on Medicaid varies considerably. Because much of what states spend on Medicaid is ultimately reimbursed by the federal government, a better way to analyze the program’s budget impact is to look only at “locally raised dollars” spent on Medicaid as a share of all locally raised money spent. (We’re using “locally raised dollars” to mean money raised by state and local taxes, fees and assessments, or borrowed by states, whether held in their general funds or other specialized funds.)

Considered that way, Missouri spent the most in fiscal 2023. It spent 25.5% of its locally raised dollars on Medicaid, according to data from the National Association of State Budget Officers. Hawaii spent the least of any state at 5.7% of its locally raised dollars.

Where does all that money go?

In fiscal 2023, a total of $884.4 billion was spent on medical services through Medicaid, according to our analysis of CMS financial data. (That figure includes rebates and offsets of various kinds but excludes $24.5 billion collected from patients and third parties. Net spending on services was $859.9 billion.)

More than half of that money ($460.6 billion, or 52.1%) went to managed-care organizations, or MCOs. Most Medicaid beneficiaries – 85% in 2022 – are enrolled in some type of managed-care plan. Under such plans, states contract with MCOs and pay a fixed monthly fee per enrollee. The MCO then either provides health care services to beneficiaries itself or pays providers to do so.

Almost $112.8 billion (or 12.8%) was spent on home- and community-based long-term care services, while another $60.4 billion (or 6.8%) went for institutional long-term care. All told, 19.6% of all Medicaid spending went to long-term care.

Another $87.9 billion, or nearly 10%, went to hospitals, and $18.8 billion (2.1%) went toward prescription drugs. About $27.6 billion (3.1%) went to pay Medicare premiums and copays for low-income elderly people who receive both Medicaid and Medicare benefits.

In addition, $34.4 billion went to federal and state administrative expenses, amounting to 3.8% of net spending.

How big a role does Medicaid play in U.S. health care overall?

In 2023, Medicaid accounted for 17.9 cents of every dollar spent on health care in the United States, according to health expenditure data from CMS. Excluding medical research and spending on buildings and medical equipment – which Medicaid doesn’t pay for at all – the program paid 18.8 cents of every dollar spent on health care services. Since about 1990, Medicaid’s share of overall health spending has mostly grown, albeit in fits and starts.

Medicaid is a much more significant player in particular areas. For example, in 2023, more than a third of home health care spending and nearly a third of spending on nursing homes came via Medicaid, according to CMS. That same year, Medicaid paid for 41% of births in the country, according to data from the Centers for Disease Control and Prevention.