12 Ways Reconciliation Changes Health Care

The 1,116-page Republican reconciliation bill that passed the House will fundamentally impact the US economy. And no sector is impacted more than health care. While headlines focus on at least $715 billion in cuts to Medicaid, there are a raft of changes in the bill that would affect costs and access for millions of families.

Below, we break down key health care provisions in the bill:

Major Medicaid Cuts

The Republican bill would fundamentally change Medicaid. Major provisions include:

1. Work reporting requirements: The bill imposes new “community engagement” requirements—commonly known as work requirements—on adults enrolled in Medicaid expansion. These rules, which are burdensome and do not increase employment, would force people to document 80 hours a month spent working, volunteering, or participating in job training programs in order to keep their coverage. This would also place additional burdens on states, as the bill requires states to set up this reporting infrastructure.

2. Limits on state provider taxes: The legislation weakens states’ ability to use provider taxes to fund their state Medicaid program. Specifically, it would ban them from raising existing provider taxes or enacting new ones. This would tie the hands of state legislatures and governors, limiting their flexibility to maintain coverage levels or respond to rising health care costs.

3. Red tape in Medicaid: The bill would create new requirements for states to conduct eligibility verifications every six months rather than every year. Frequent eligibility checks increase administrative costs for states and create more opportunities for eligible individuals to lose coverage simply because they missed a piece of mail, failed to meet an arbitrary deadline, or made a mistake in their paperwork.

4. Delayed rules: The bill places a moratorium on key Biden Administration rules designed to simplify and modernize enrollment in Medicaid and the Children’s Health Insurance Program (CHIP). These rules streamlined the application and renewal process, reduced paperwork barriers, and aligned eligibility systems across programs. These rules would have made it easier for families, especially children, to get and stay covered.

5. Increased costs for patients: The bill imposes new patient cost-sharing of up to $35 on people in the Medicaid expansion population—many of whom already live paycheck to paycheck.

The bill also contains other provisions affecting Medicaid, such as reducing the federal match for states that use their own dollars to provide coverage for undocumented immigrants and ending incentives for states to expand Medicaid who have not yet done so.

Weakening the Affordable Care Act

In addition to slashing Medicaid, Republicans are targeting the Affordable Care Act. Major provisions include:

6. Cuts to premium support for middle-class families: The enhanced ACA premium tax credits, originally expanded under the American Rescue Plan and extended in the Inflation Reduction Act, cap premiums at 8.5% of a household’s income. This makes coverage substantially more affordable for middle-income families. However, the credits expire at the end of 2025, and the Republican bill does not extend them. Without these credits, over 4 million people will lose coverage, and millions more will face premium hikes of hundreds—even thousands—of dollars a year.

7. Raising premiums: The bill drives up premiums for people with ACA coverage by reinstating insurer payments for “cost-sharing reductions.” These are meant to lower out-of-pocket costs for some low-income enrollees in silver plans. The problem is this approach raises premiums across the board and cuts premium subsidies for everyone in the marketplace. It’s a costly giveaway that leaves middle-class families paying more for less coverage.

8. Shortened enrollment: The bill significantly shortens the open enrollment period and eliminates the special enrollment period for people under 150% of the poverty line. It also prevents enrollment in expanded ACA coverage for anyone who loses Medicaid coverage due to not meeting Medicaid work requirements.

9. Increased red tape: Provisions in the bill would add new reporting and documentation requirements for ACA marketplace enrollees—creating administrative burdens that could result in fewer people enrolling or remaining covered. These changes would make the enrollment system more complex and difficult for low-income and working-class families to get the coverage they qualify for. For example, applicants will have to prove they are not lying about their projected income by supplying documentation if they were not required to file an income tax form or if they made too little money in the previous year to qualify for a tax credit.

Expanding Health Savings Accounts: Tax Cuts Disguised as Health Reform

The Republican bill also includes a sweeping expansion of Health Savings Accounts (HSAs), a tax break that overwhelmingly benefits high-income households. Major provisions include:

10. Expanded participation: The bill would allow people enrolled in Medicare Part A, but not Part B, to contribute to HSAs. This will benefit wealthier retirees who already have robust retirement savings, while offering no support to low-income seniors who lack savings altogether.

11. Raised contribution limits: The bill would double the contribution limit to HSAs to $8,600 annually. However, this only applies to people making under $75,000 a year, who rarely contribute the maximum for HSAs. This does little for families who cannot afford health care to begin with, especially in conjunction with Medicaid and ACA cuts.

Cuts to Medicare

Despite President Trump’s pledge to not cut Medicare, the Republican bill would trigger an automatic $490 billion cut. Here’s how:

12. Triggering Sequestration: Because the bill increases deficits by $2.3 trillion, the Statutory Pay‑As‑You‑Go Act of 2010 requires an automatic cut across the federal budget to make up the difference. While the cuts to Medicare at limited at 4%, that’s $490 billion over the decade. While Republicans could have included a stop to these cuts in their legislation, they chose not to do so.

Conclusion

This legislation would take health care away from millions of Americans, roll back vital protections, and deepen health inequities—all to fund tax breaks for the wealthy. Congress should reject this assault on health care and working families.