Medicaid Changes in House and Senate Reconciliation Bills Would Increase Costs for 1.3 Million Low-Income Medicare Beneficiaries

The U.S. House of Representatives passed a reconciliation bill on May 22 known as the One Big Beautiful Bill Act, which proposes significant reductions to Medicaid funding to help offset the cost of extending expiring tax cuts.

According to estimates from the Congressional Budget Office (CBO), the legislation would reduce federal Medicaid spending by $793 billion over a ten-year period.

Projected Impact on Health Coverage

The CBO projects that the spending cuts will lead to a substantial decrease in the number of people covered by the program. By 2034, the agency estimates that 10.3 million fewer people would be enrolled in Medicaid as a result of the bill.

A significant portion of this coverage loss would affect dual-eligible individuals, who are low-income beneficiaries that qualify for both Medicare and Medicaid.

The CBO estimates that 1.3 million of the individuals losing coverage under the proposed changes are these dual-eligible Medicare beneficiaries.

Understanding Dual Eligibility

Dual eligibility occurs when an individual meets the financial and medical requirements for both Medicare, the federal health insurance program primarily for people 65 and older and younger people with certain disabilities, and Medicaid, the joint federal and state program that provides health coverage to people with low income.

For many of these individuals, Medicaid serves as a critical secondary layer of support, covering costs that Medicare does not, such as certain long-term care services and premiums.

The loss of this coverage for 1.3 million people represents a significant shift in the health safety net for low-income seniors and people with disabilities.