Trump’s OBBBA: The Legislation Deepening America’s Health Divide

Authored by: Reese Visaya

Art by: Rachel Jacob

On July 4th, 2025, President Donald Trump signed the One Big Beautiful Bill Act (OBBBA) into law, marking a pivotal shift in U.S. healthcare policy. This widely debated budgeting mega-bill includes reforms to SNAP (Supplement Nutrition Assistance Program) benefits; eliminating some taxes on tips, overtime, and social security; a significant increase in funding for immigration enforcement; and many other budgeting adjustments [1]. This bill includes a 10% reduction in Medicaid spending and will substantially reduce access to healthcare for low and middle income Americans, an area where the U.S. already pares poorly in comparison with other high income countries. Experts predict this will result in nearly 10 to 12 million individuals losing health insurance coverage, disproportionately affecting marginalized, rural, and low income populations [2]. 

The Affordable Care Act was signed in 2010 by President Barack Obama with the goal of improving healthcare coverage by increasing subsidies to cover costs and expanding Medicaid. The Act was successful in reducing the uninsured rate from 16% in 2010 to 7.9% in 2023, allowing millions to receive government-funded subsidies on private insurance and expanding access to Medicaid public health insurance [3]. Currently, almost 40% of Americans are enrolled in a public health insurance program (Medicaid or Medicare). The OBBBA attempts to repeal many of the policy changes made by the Affordable Care Act aimed at making healthcare more accessible to low and middle income Americans [4].

To enable tax cuts, elsewhere, OBBBA has added additional restrictions and eligibility requirements to Medicaid, the public healthcare program relied upon by millions of disabled and low income Americans. These changes include introducing complex work requirement documentation mandates, more frequent eligibility checks, and reduced federal funding for states;; requirements that have been shown to disproportionately disenfranchise low-income individuals, young adults, people with disabilities, and seniors who face greater obstacles in understanding and navigating new eligibility procedures [5]. The act restricts Medicaid and Medicare eligibility for many lawfully present immigrants, including refugees and asylum seekers, who previously qualified for coverage. The law also prohibits the implementation of rules designed to make Medicare more affordable for low-income seniors and blocks federal nursing home staffing standards [6]. On average, uninsured people receive 50% less medical care than insured people, leading to decreased health outcomes. Reduction in coverage will have disproportionate negative health consequences on already marginalized groups.

In addition to the individual effects on public medical care coverage, the One Big Beautiful Bill Act will have wider systemic impacts on U.S. healthcare. The large increase in uninsured patients will lead to higher uncompensated care costs in hospitals and physician’s offices. To offset the reduction in funding, hospitals will most likely be forced to eliminate service or pay physicians and hospital staff less. This will disproportionally affect hospitals in rural regions, where there are higher percentages of uninsured and Medicaid beneficiaries. The bill includes a 50 billion dollar “Rural Health Fund”, distributed amongst all 50 states over the next five years. However, this fund will not fully offset the billions in projected losses from Medicaid cuts [7]. Projected hospital closures will lead to farther travel and longer wait times. Rural hospital closures increase patient mortality rate by 0.78%, compared to urban closures that have no measurable impact [8]. Increased compensatory funding for rural hospitals will be necessary to maintain the health of rural populations. 

The One Big Beautiful Bill Act will no doubt have dramatic effects throughout the country. Effects on medical care coverage will disproportionately impact marginalized, rural, and low income populations. There are ways to reduce U.S. medical spending without jeopardizing the health of vulnerable populations; administrative costs could be lowered, excess pharmaceutical costs could be eliminated, or sensible restrictions on unnecessary hospital testing could be implemented. The failure of the current administration to prioritize population health and positive healthcare outcomes over bottom line cost reductions in crafting economic policy will change the healthcare landscape of the United States.

References:

1. White House. (2025). President Trump’s One Big Beautiful Bill is now the law. White House. https://www.whitehouse.gov/articles/2025/07/president-trumps-one-big-beautiful-bill-is-now-the-law/

2. U.S. Congress. (2025). Text – H.R.1 – 119th Congress (2025–2026): One Big Beautiful Bill Act. Congress.gov. https://www.congress.gov/bill/119th-congress/house-bill/1/text

3. U.S. Department of Health and Human Services.(2019) About the Affordable Care Act (ACA). HHS.gov. (https://www.hhs.gov/healthcare/about-the-aca/index.html).

4. Neiman, Pooja (2021). The Affordable Care Act at 10 Years: Evaluating the Evidence and Navigating an Uncertain Future. Journal of Surgical Research 263, 102-109 https://www.journalofsurgicalresearch.com/article/S0022-4804(21)00016-0/fulltext 

5. Sommers, Benjamin (2019). Paying for Medicaid - State Budgets and the Case for Expansion During Coronavirus. The New England Journal of Medicine 832(24). https://www.nejm.org/doi/full/10.1056/NEJMp2007124 

6. American Medical Association. (2025). Changes to Medicaid, the ACA and other key provisions in the “One Big Beautiful Bill” Act. AMA. https://www.ama-assn.org/health-care-advocacy/federal-advocacy/changes-medicaid-aca-and-other-key-provisions-one-big 

7. Cutler, DM (2025). The Worst Piece of Health Care Legislation Ever. JAMA Health Forum 6(8) https://jamanetwork.com/journals/jama-health-forum/fullarticle/2838483 

8. Gujral, K., & Basu, A. (2019). Impact of rural and urban hospital closures on inpatient mortality. National Bureau of Economic Research (No 26182). https://doi.org/10.3386/w26182 

9. Budhu, Joshua (2025). Emergency Medicaid at Risk - Preserving State Authority and Access to Care. New England Journal of Medicine 3939(14) https://www.nejm.org/doi/full/10.1056/NEJMp2508944