Millions at Risk of Losing Health Insurance Under Proposed GOP Tax Bill

WASHINGTON (AP) — The proposed Republican domestic policy package, dubbed the “One Big, Beautiful Bill Act,” threatens to strip health insurance from approximately 11.8 million adults and children if it becomes law. This sweeping legislation aims to extract nearly $1 trillion from federal health care programs, including Medicaid, the Affordable Care Act (ACA), and the Children’s Health Insurance Program (CHIP), over the next decade.

The potential impact of this bill is significant, as it could reverse years of progress in expanding health insurance coverage across the United States. Currently, around 78 million individuals are enrolled in Medicaid, while 24 million people benefit from ACA marketplace plans. The bill’s passage could lead to a gradual decline in enrollment, affecting millions who rely on these programs for essential health care services.

Heightened Scrutiny for Medicaid and ACA Enrollees

One of the most controversial aspects of the GOP plan is the increased frequency of income and eligibility verification for Medicaid recipients. Under the proposed changes, states would be required to verify a person’s income every six months to determine Medicaid eligibility. This heightened scrutiny could disproportionately impact vulnerable populations, including the homeless and transient individuals, who may struggle to keep up with the paperwork demands.

Martha Santana-Chin, CEO of L.A. Care Health Plan, which serves millions of Medicaid beneficiaries in Los Angeles, expressed concern about the potential impact on these populations. “The life experience of these individuals is not necessarily one that allows them the luxury of having to work through onerous paperwork,” she noted.

“When Texas increased income eligibility checks between 2014 and 2019, thousands of kids lost coverage in the state,” critics argue, highlighting the potential pitfalls of such frequent checks.

Challenges for Children’s Health Insurance Program

The proposed legislation also introduces obstacles for children enrolled in CHIP. States would have the authority to delay enrollment for children if their parents are behind on premium payments. Premiums for children’s coverage can reach up to $100 per month in some states, according to health policy research firm KFF. Additionally, states could impose waiting periods for children transitioning from private insurance to Medicaid.

These measures mark a departure from the policies of the Biden administration, which prohibited states from blocking children’s enrollment over missed payments or imposing waiting periods during transitions from private insurance.

Immigrant Access to Health Coverage

The GOP bill further restricts access to health coverage for immigrants. It narrows the definition of who qualifies for lower-cost ACA plans, potentially excluding thousands of refugees and asylum seekers. States offering Medicaid to immigrants, funded solely by state tax dollars, may face reduced federal support, as the bill proposes lowering the federal reimbursement rate for legal residents from 90% to 80%.

This reduction in federal funding could lead some states to discontinue their programs for immigrants. California has already announced a freeze on new enrollments for state-funded Medi-Cal for immigrants, while Illinois recently halted its program.

Work Requirements and Bureaucratic Hurdles

Perhaps the most significant change in the GOP proposal is the introduction of work requirements for Medicaid eligibility. Individuals aged 19 to 64 would need to work, volunteer, or attend school for at least 80 hours per month to qualify for Medicaid. Exemptions would apply to those who are disabled, pregnant, or caring for a child under 14.

Michael F. Cannon, director of health policy studies at the Cato Institute, suggests that this requirement could deter some individuals from enrolling in Medicaid. “It can encourage people who don’t value Medicaid coverage not to sign up for it,” Cannon stated. “And that saves the government money.”

However, most Medicaid enrollees already meet these criteria, with only about 8% reporting they are not working or unable to find work.

Critics warn that the work requirement could lead to coverage losses due to bureaucratic errors, overlooked forms, or difficulties in providing necessary documentation. This was evident in Arkansas, where a similar requirement resulted in 18,000 people losing Medicaid coverage within seven months before a federal judge intervened.

Implications for Dual Medicare and Medicaid Enrollees

The GOP bill also complicates the enrollment process for individuals eligible for both Medicare and Medicaid, often due to a disability. It rolls back measures implemented by the Biden administration to streamline enrollment, such as automatic enrollment for those qualifying for supplemental income.

Jennifer Tolbert, director of state health policy at KFF, warns that rescinding these rules could lead to coverage losses. “It’s likely that some people will lose coverage because they get caught up in these paperwork burdens,” she explained.

As the debate over the GOP’s proposed tax bill continues, the potential consequences for millions of Americans remain a critical focal point. The bill’s passage could reshape the landscape of federally-funded health care programs, with far-reaching implications for those who rely on them for essential coverage.

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