HR-1 The OBB Act

How U.S. Health Care is Changing After Its Passage

The recent passage of the “One Big Beautiful Act” (OBBA) marks one of the most consequential policy shifts in U.S. health care since the enactment of the Affordable Care Act in 2010. This sweeping legislation introduces a range of reforms aimed at reducing federal spending and tightening eligibility for government health programs. While proponents may tout fiscal responsibility, critics argue that the bill will cause millions to lose coverage, increase health care inequities, and put extensive strain on health systems.

Here’s a breakdown of how the OBBA is reshaping the American health care landscape and what it means for patients, providers, and policymakers.

Medicaid Overhaul: Reduced Rolls and New Requirements

Among the most significant changes in the OBBB are reforms to Medicaid, which is currently the largest source of health coverage for low-income Americans. The OBBB introduces stricter eligibility verification mechanisms for enrollees. There are also new work mandates and other community engagement requirements for certain people who are Medicaid eligible. States will now also face a moratorium on new or increased provider taxes, limiting a key source of Medicaid financing.

While these changes will not begin to go into effect until late 2026, communities and providers alike will need to prepare for the impact, which may reduce access to services even earlier. Additionally, Disproportionate Share Hospital (DSH) payment cuts, which were scheduled to take effect in 2026, are delayed until 2028. This temporary relief is also coupled with increased efforts to remove ineligible individuals from state Medicaid rolls through enhanced auditing and income checks. Medicaid policies, given their political volatility, may be altered somewhat prior to or after implementation, as the true impact on this population of patients becomes more evident.

Impact: Millions of Americans may lose Medicaid coverage as a direct result of this legislation Additionally; states could face increased administrative complexity and reduced flexibility in managing their Medicaid programs.

ACA Marketplace Rollbacks: Higher Costs, Fewer Enrollees

The OBBB also targets key elements of the Affordable Care Act (ACA) that have supported millions with subsidized health insurance through the federal and state marketplaces. Enhanced premium tax credits, which were expanded under COVID-19 relief packages and extended by the Inflation Reduction Act, are not renewed under the OBBB framework. These subsidies have been critical in lowering premium costs for low- and middle-income individuals and families. Clearly, this dynamic will alter enrollment trends and shift the nature and composition of the risk pools which determine pricing strategy.

Additionally, the shortened open enrollment period for ACA coverage will impact on the size, depth and diversity of plans. The introduction of new administrative hurdles like additional documentation requirements and more stringent income verification processes during the enrollment process will also be a complicating factor.

Impact: The loss of tax credits and increased enrollment barriers are projected to force millions off ACA plans, especially among adults aged 50 to 64 who are particularly sensitive to rising premiums. This rollback is expected to increase the national uninsured rate, reversing over a decade of gains.

Medicare Changes: Rural Expansion Meets Nursing Home Risks

While the OBBB includes concerning cutbacks, it also seeks to expand access in underserved areas. One provision broadens the scope of what qualifies as a “rural emergency hospital” under Medicare, which could improve health care access in parts of the country hardest hit by provider shortages. However, initial reports and analyses are showing negative impacts to care access in rural America with an identified 300+ rural hospitals cited as either at risk of closing or implementing major service reductions.

From a long-term care perspective, the OBBB repeals the federal minimum staffing regulations for nursing homes. This provision, opponents argue, will likely jeopardize care quality for vulnerable seniors in long-term care facilities.

Impact: It’s theorized that the rural expansion component may possibly benefit isolated communities, but initial reports are pointing towards reduced access to care. Additionally, repealing nursing home staffing requirements raises red flags about patient safety and outcomes in elder care.

New Focus on Health Savings Accounts (HSAs)

The bill significantly expands the use of Health Savings Accounts (HSAs), raising contribution limits and broadening eligibility. This change is likely to positively impact higher-income Americans who have greater disposable income. These individuals will benefit from provisions that skew to the higher-income demographic like greater tax savings, contribution rules, and new eligible expenses (i.e. health club memberships, concierge care memberships, etc.).

Additionally, the OBBB has language aimed at restoring “program integrity,” a euphemism for increased scrutiny of eligibility for both Medicaid and ACA subsidies.

Impact: While fiscally advantageous to wealthier Americans, these provisions are unlikely to help lower- or middle-income families facing rising insurance costs or coverage losses. Lower income enrollees are likely to face additional scrutiny and bureaucracy.

Fiscal Effects and Public Health Concerns

Supporters of the Big Beautiful Bill argue that it introduces much-needed efficiency and responsibility to the health care system. The Congressional Budget Office (CBO) estimates that the legislation could reduce federal outlays for Medicaid and ACA subsidies by roughly $1.15 trillion over the next decade. It is import to contextualize this given the full impact of the bill’s CBO estimate. The bill is estimated to add $3.4 trillion to the national debt, fueled by the $4.5 trillion in tax cuts in the bill.

However, the estimated financial savings come at a human cost. It is estimated that this legislation will result in 10 million more Americans will be uninsured by 2034. Health policy experts warn that the cloture of coverage options, especially for lower-income households, may lead to deteriorating health outcomes, delays in care, and an increase in preventable hospitalizations and deaths. Hospitals, particularly those serving low-income and rural populations, also brace for an uptick in uncompensated care as uninsured rates rise.

What the OBBB Means for Health Care in America

The Big Beautiful Bill represents a pivot in U.S. health policy focused heavily on cost containment and reducing federal health care exposure. Although there are elements aimed to address program integrity and reduce dependence on federal subsidies, it introduces significant risk of destabilizing access for millions of Americans, particularly those with the fewest resources.

Summary

• Medicaid: Millions may lose coverage due to stricter eligibility checks.
• ACA Marketplaces: Higher costs and enrollment barriers could mean fewer insured Americans.
• Medicare: Rural access expands, but nursing home care may suffer.
• HSAs: Benefits skew toward wealthier individuals.
• Budget: There are Federal savings (on health care provisions) due to the cuts, but with increased health and social risk. Any savings from these healthcare cuts will likely be more than offset by broader provisions of the OBBB.

The full effects of the OBBB will likely unfold over the coming years. As implementation begins, advocacy groups, lawmakers, and health care providers will play critical roles in mitigating harm and ensuring vulnerable populations do not fall through the cracks. Due to the political polarization of this issue, this is likely not a topic that will recess. Once past the 2026 midterms, the results could yield changes or alternate approaches aimed at mitigating the full impact of this law in the healthcare space.

As the health care landscape shifts rapidly under the OBBB Act, it’s clear that preparing now is more important than ever for organizations across the industry. Proactive planning isn’t just recommended – it’s essential for those who want to stay ahead and minimize uncertainty.

Chrysoli Consulting was founded for moments just like this: to help organizations understand, adapt to, and thrive through sweeping environmental changes. We know that, with so much on your plate, dedicating time and resources to navigating the impact of HR-1 can feel overwhelming.

If you’re facing questions or concerns about what these changes mean for your business, we’re here to help. Connect with Chrysoli Consulting to start a conversation-together, we’ll map out practical strategies, address your specific needs, and position your organization for continued success in this new era of health care. Let’s navigate the future of healthcare, together.

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Sources:

1. Congressional Budget Office (CBO), 2025 Report on the BBB Impacts
2. Kaiser Family Foundation (KFF), “How the BBB Could Affect Health Coverage”
3. Centers for Medicare & Medicaid Services (CMS), Bulletins on Medicaid Eligibility
4. Health Affairs, “Policy Review: The Big Beautiful Bill and the ACA Rollback”
5. American Hospital Association, Statement on the Financial Outlook Post-BBB
6. Journal of the American Medical Association (JAMA), “Projected Health Outcomes of Coverage Losses Post-BBB”