Nearly 14 Million Americans Could Lose Health Insurance Coverage
In a razor-thin vote that underscores deep political divisions, the House of Representatives passed the controversial One Big Beautiful Bill Act on May 22 by a margin of just 215–214. The reconciliation budget bill contains far-reaching changes to America’s health care system that could fundamentally reshape Medicaid and the Affordable Care Act (ACA), with significant implications for mental health counselors.
The legislation now moves to the Senate, facing an uncertain future.
Medicaid Overhaul Creates New Barriers
The bill introduces work requirements for childless adults under 65 without disabilities, mandating at least 80 hours of monthly work, community service, or educational activities to maintain Medicaid coverage. States would be required to conduct eligibility redeterminations every 6 months for adults in the Medicaid expansion population—doubling the current annual requirement.
For beneficiaries, the bill imposes cost-sharing of up to $35 per service for Medicaid expansion enrollees with incomes above the federal poverty level ($15,650 annually), potentially creating financial barriers to care.
The legislation also targets Medicaid financing by prohibiting new provider taxes that many states rely on to generate their share of program funding. For expansion states, the bill lowers the enhanced federal matching rate from 90% to 80% for specific populations and removes additional federal funding from the 2021 American Rescue Plan Act.
States would be prohibited from directing managed care companies to pay providers more than 100% of Medicaid rates, though non-expansion states could pay up to 110% of Medicare rates.
The Congressional Budget Office (CBO) estimates approximately 7.7 million Americans would lose Medicaid coverage over the next decade as a result.
ACA Marketplace Restrictions
The bill also restructures the ACA’s insurance marketplaces by shortening the enrollment period by 1 month and eliminating special enrollment opportunities for lower-income Americans. It terminates continuous enrollment for those below 150% of the federal poverty threshold and prohibits exchanges from creating enrollment windows based on income.
The legislation ends automatic enrollment into Silver-level plans for low-income customers with Bronze plans, even when they qualify for cost-sharing reductions only available with Silver coverage. It also fails to extend health insurance premium subsidies set to expire Dec. 31.
The CBO projects 6 million ACA beneficiaries will lose health insurance due to these changes.
Medicare: Mixed Implications
In a potentially positive development for providers, the bill increases Medicare reimbursement by 2% in 2026 and links future updates to the Medicare Economic Index, creating a more predictable payment framework.
However, the legislation carries a hidden threat. CBO projects it would add at least $2.3 trillion to the deficit, triggering automatic cuts under the Statutory Pay-As-You-Go Act. These would slash over $500 billion from Medicare between 2026–2034, unless Congress takes specific action to prevent them.
Key Implications for Mental Health Counselors
Client Access Concerns:
- Combined loss of 13.7 million Americans from Medicaid and ACA coverage could significantly reduce client base.
- Six-month redeterminations may interrupt treatment for mental health conditions.
- $35 per-service cost-sharing could make regular therapy financially unsustainable for lower-income clients.
Practice Operations:
- Prohibition on enhanced state-directed payments may reduce reimbursement rates.
- Increased eligibility verification will strain administrative resources.
- Cash flow volatility is likely as coverage disruptions increase.
- Smaller practices with high Medicaid caseloads may struggle to remain viable.
Service Adaptations:
- Counselors may need to help document medical exemptions from work requirements.
- Clients will look to counselors for assistance in meeting enrollment paperwork requirements.
- Crisis service demand may increase as preventive care becomes less accessible.
- Client demographics may shift toward Medicare and commercially insured populations.
Advocacy Opportunities:
- NBCC will engage in the Senate's consideration to modify onerous provisions.
- Shape implementation of work requirements and verification processes.
- Establish reasonable documentation standards for condition severity.
Whatever the outcome, this legislation represents the most ambitious attempt to restructure America's health care safety net since the passage of the ACA in 2010.
