The loss of Medicaid and ACA health insurance will lead to fewer patients for physicians

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President Donald Trump’s signature legislative package — the One Big Beautiful Bill Act — has been passed and signed into law, and many in the insurance industry are bracing for potential ramifications in several areas the law now touches.

Areas that might feel an impact include reduced patient volumes and patients losing coverage, as well as some potential upsides. But one thing is clear: Change is coming now that the ink is dry on the new law.

At its heart, the One Big Beautiful Bill Act is a sweeping tax and spending bill that cuts trillions in taxes over the next 10 years. To pay for that, Congress has made huge cuts and changes to many health care programs, not the least of which are Medicaid and the Affordable Care Act.

Michael Giusti, MBA
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The Robert Wood Johnson Foundation estimates that from all the areas the law impacts, its end result will be a nearly $800 million decrease in medical spending over the next decade across various programs.

Because many of the direct changes were to Medicaid, the biggest impact is expected to be felt most by the 40 states that have expanded Medicaid, but the states that have not expanded Medicaid also stand to lose substantial federal funding.

Fewer Medicaid recipients could translate to reduced patient volumes, particularly impacting facilities that rely heavily on Medicaid, such as skilled nursing facilities and, to some extent, rural hospitals.

That said, the law also contains a provision that might make it a bit of a mixed bag for physicians who accept Medicaid. That’s because the law does come with a 2.5% increase in Medicaid reimbursements for physicians in 2026.

Advocates for the law point out that the changes don’t directly take away any Medicaid coverage from the more than 71 million U.S. citizens who are enrolled in the program but instead create new requirements for participants.

One of the biggest changes is the Medicaid work requirements, which mandate that most able-bodied adults log at least 80 hours a month of work, school, or volunteer work to remain in the program. That requirement is waived for several classes of people, including parents of young children, elderly individuals, and many disabled people.

The place where most critics weigh in is where it comes to certifying that work. The new law requires recipients to file paperwork proving their eligibility at least twice each year — a requirement many critics liken to asking Medicaid recipients to file their taxes twice annually.

Whether because people aren’t expected to satisfy the work requirement or because they might fall prey to cumbersome paperwork, the Congressional Budget Office predicts nearly 12 million people could lose their coverage because of the law.

With fewer people enrolled in Medicaid, programs that rely on a large percentage of Medicaid patients stand to suffer, especially rural hospitals and skilled nursing facilities. To help soften the blow for the rural hospitals, the law also includes a stabilization fund that Congress hopes will keep rural hospital doors open.

The law’s insurance implications don’t stop with Medicaid, though. There are some major changes that will ripple through the Affordable Care Act as well. More than 24 million people have an Affordable Care Act Marketplace Plan at last count.

While it isn’t strictly a change, one major aspect of the law is that it will allow the enhanced premium subsidies enacted under President Joe Biden to expire at the end of 2025. Without those enhanced subsidies, the typical Marketplace Plan will cost several hundred dollars more for many households.

The law also tweaks who is eligible for the Marketplace Plan subsidies that are remaining in place.

It is also changing the process for renewing Marketplace Plans once open enrollment comes up this fall. A major change is that the law ends auto enrollment for Marketplace Plans, meaning each policyholder needs to actively pick their new policy each year and can’t just let their old policy roll over into the new year — a provision used by approximately half of all returning marketplace plan holders in 2025.

Open enrollment will be shorter, with one month cut off the end of the selection period.

According to health care nonprofit KFF, those Marketplace Plan changes could lead to more than 8 million Marketplace Plan holders losing their coverage.

While it is too soon to see how the One Big Beautiful Bill Act ultimately impacts the health care industry, one sure thing is that fewer insured people means fewer patients seeking routine care.

History has also shown that when fewer people have primary insurance, they instead opt for treatment in emergency facilities, leading to more uncompensated care. The Robert Wood Johnson Foundation estimates that the law will likely result in over $200 million more in uncompensated care over the next decade that will have to be absorbed by the rest of the medical community.

Michael Giusti, MBA, is an analyst at InsuranceQuotes.com, which publishes in-depth studies, data and analysis related to auto, home, health, life and business insurance. In his role as analyst, Michael studies the insurance industry to provide trusted tips, advice and insights. He has worked as a journalist for more than 20 years, including as a reporter at a daily newspaper in Florida, as an editor at a regional business journal, and as a writer for national and international publications. He is based out of New Orleans.