What Happens When Coverage is Cut? Looking Backward and Forward From the One Big Beautiful Bill

Area of Science:

• Health Policy
• Health Economics
• Public Health

Background:

• The One Big Beautiful Bill Act (OBBBA) is projected to cut $1 trillion from federal health care programs, leading to 10 million individuals becoming uninsured.
• Previous analyses of the OBBBA's impact have primarily focused on the inverse effects of coverage expansions, rather than past coverage contractions.

Purpose of the Study:

• To examine the impacts of past large-scale coverage contractions on health care access, finances, and health outcomes.
• To provide insights into the probable effects of the OBBBA on the medical care and health of vulnerable populations.

Main Methods:

• A review of studies on four significant prior coverage contractions: Reagan-era Medicaid cuts, TennCare disenrollment (2005), Arkansas work requirements (2019), and the Medicaid Unwinding.
• Synthesizing findings from these contractions to predict the consequences of the OBBBA.

Main Results:

• Coverage contractions lead to reduced care utilization, increased financial strain, and worsened physical and mental health for low-income individuals.
• Most individuals losing Medicaid do not obtain alternative coverage, and states are unlikely to compensate for federal funding reductions.
• Work requirements impose administrative burdens, and the negative consequences of coverage losses may outweigh benefits seen from expansions.

Conclusions:

• The OBBBA will exacerbate existing issues in US health care, including insurance churn, care degradation, and health inequality.
• Mitigation by states may be insufficient; full protection requires repealing the OBBBA or implementing universal, seamless coverage.