Major Medicaid changes are scheduled to take effect after the November 2026 midterm elections, including work requirements, more frequent eligibility reviews, shorter coverage for past medical bills, and restrictions on how states finance care. Other changes affect Medicare beneficiaries, especially people with low incomes and certain legally present immigrants. Most stem from the reconciliation law signed on July 4, 2025, commonly called the One Big Beautiful Bill Act, or Public Law 119-21. Medicaid
However, there is no single, across-the-board Medicare and Medicaid cut that begins immediately after Election Day. The changes have different starting dates, affect different groups, and operate through different mechanisms. Some reduce eligibility, some increase patients’ expenses, and others reduce funding available to states and health care providers. Several provisions began before the midterms, while others do not begin until 2028 or later. Medicaid
One especially important correction concerns Medicare: the automatic Medicare cuts originally projected to result from the law’s deficit impact were subsequently prevented by Congress. Those canceled cuts should not be presented as an upcoming reduction in everyone’s Medicare coverage. Federal Register
The Previously Projected Automatic Medicare Cuts Were Canceled
After the 2025 reconciliation law passed, the Congressional Budget Office estimated that its deficit effects could trigger approximately $536 billion in Medicare payment reductions under the statutory “pay-as-you-go,” or PAYGO, law. Those automatic reductions could have reached the law’s 4% annual Medicare limit. That estimate described what would happen without additional congressional action. Congressional Budget Office
Congress subsequently acted. Public Law 119-37, enacted in November 2025, cleared the relevant PAYGO balances. The Office of Management and Budget’s January 2026 report confirmed that all years on both PAYGO scorecards were zero and that no sequestration order was required. This was not simply a one-year postponement of the reconciliation law’s projected cuts. Federal Register
Consequently, beneficiaries should not expect a new 4% reduction in their Medicare benefits after the midterms because of that earlier projection. Separate, older Medicare sequestration rules remain a different issue, and the law’s other Medicare-related changes still require attention. Federal Register
The Medicaid Reductions Are Substantial, but They Unfold Over Years
KFF’s analysis of the enacted law’s budget estimates projects approximately $911 billion less federal Medicaid spending over 2025–2034 than under the previous-law baseline. That is a cumulative reduction relative to what otherwise would have been spent, not a $911 billion cut in one year or an equal percentage reduction in every beneficiary’s care. KFF
CBO estimated that the Medicaid provisions would leave 7.5 million additional people uninsured in 2034. This is a projection, not a count of people scheduled to lose coverage on January 1, 2027. Congressional Budget Office
Medicaid Work Requirements Generally Begin January 1, 2027
The law requires certain adults ages 19 through 64 to meet a work or “community engagement” requirement to obtain or retain Medicaid. It primarily affects the Affordable Care Act’s Medicaid expansion population and certain adults covered through state demonstration programs. It does not apply to every Medicaid beneficiary, and people entitled to or enrolled in Medicare are excluded. Centers for Medicare & Medicaid Services
Affected adults generally must complete 80 hours per month of qualifying employment, community service, work-program participation, or a combination of approved activities. Enrollment in an educational program at least half-time can also qualify, as can meeting an earnings threshold. Exemptions include pregnancy and postpartum coverage, qualifying disabilities or medical frailty, certain American Indians and Alaska Natives, and qualifying parents or caregivers of children under age 14 or people with disabilities. Centers for Medicare & Medicaid Services
States generally must implement the requirement by January 1, 2027, although earlier implementation is permitted. The law also allows temporary federal extensions for states making good-faith implementation efforts, potentially through the end of 2028. A person’s actual starting date therefore depends on the state’s implementation schedule. Medicaid
For individuals, the risk involves both meeting the requirement and proving compliance. Applicants can face a state-selected lookback period of one to three months. States must use available information where possible, and when compliance cannot be verified, they must provide notice and 30 days to demonstrate compliance or an exemption before taking further action. A worker with irregular hours or a person whose medical exemption is not properly recorded could face a coverage interruption. Federal Register
Losing Medicaid for failure to meet this requirement does not create eligibility for subsidized Marketplace coverage as a fallback. CBO projected that the work requirement alone would increase the uninsured population by 5.3 million in 2034. Congressional Budget Office
Many Expansion Adults Will Face Medicaid Renewals Every Six Months
Beginning with the 2027 implementation schedule, most adults enrolled through Medicaid expansion will have their eligibility reviewed every six months instead of annually. States have transition options for existing beneficiaries, so January 1 is not a universal renewal or termination date. Medicaid
This matters even for someone who remains financially eligible. More frequent reviews create more opportunities for a missed notice, an outdated address, or an incomplete document to interrupt coverage. A person exempt from the work requirement because of medical frailty may still be subject to six-month renewals if enrolled in the expansion eligibility category. Medicaid
For example, a hypothetical worker whose income has not changed might still need to respond to two renewal requests in a year. Being exempt from work requirements does not necessarily mean being exempt from the new renewal schedule. Medicaid
Medicaid Will Cover Fewer Months of Medical Bills From Before an Application
For applications submitted on or after January 1, 2027, retroactive Medicaid coverage becomes shorter. Instead of the generally available three months before the application month, expansion adults can receive up to one month. Other Medicaid applicants, including people applying through age- or disability-related categories, can receive up to two months, subject to eligibility and applicable state rules. Cal Health Care Services
This is a direct financial risk for people who apply only after a hospitalization or other expensive medical event. Consider a hypothetical expansion-eligible adult hospitalized in January who does not apply until March. Under a three-month retroactive period, January could potentially have been covered. Under the new one-month period, retroactive coverage generally reaches only February. Cal Health Care Services
The change does not limit how long an eligible person can remain covered after approval. It reduces protection for bills incurred before applying, making prompt applications particularly important. Cal Health Care Services
Restrictions on Provider Taxes Will Reduce States’ Financing Options
States often use taxes on hospitals, health plans, and other providers to help finance their Medicaid programs and obtain federal matching funds. The law generally restricts new or increased provider-tax financing using July 4, 2025, levels as the reference point. Medicaid
For expansion states, a key permissible financing threshold begins declining on October 1, 2027. It falls from as much as 6% of net patient revenue to 5.5%, then decreases by half a percentage point annually until reaching 3.5% in federal fiscal year 2032. Nursing-facility and intermediate-care-facility taxes are excluded from this particular phased reduction. Medicaid
This is not a new tax bill mailed to Medicaid patients. Its potential effect is indirect: states may need to replace lost financing, reduce provider payments, or reconsider optional services. For patients, the concern is whether nearby providers continue participating and whether services remain available. Those outcomes depend on state budget decisions rather than occurring automatically under the federal law. Medicaid
A separate provision restricts tax structures that disproportionately tax Medicaid business compared with other business. CMS finalized implementing rules in February 2026, with some compliance deadlines beginning January 1, 2027 and others occurring later. States can redesign affected taxes, but failure to comply can jeopardize federal matching funds. Federal Register
Certain Supplemental Provider Payments Will Be Reduced Beginning in 2028
The law also limits certain payments that states direct Medicaid managed-care plans to make to hospitals, nursing facilities, and qualifying practitioners at academic medical centers. The applicable payment limits are generally tied to 100% of Medicare rates in expansion states and 110% in non-expansion states. Medicaid
Some existing arrangements receive temporary protection. For qualifying grandfathered arrangements, the phase-down begins with payment-rating periods starting on or after January 1, 2028, and proceeds by 10 percentage points annually until the applicable limit is reached. This does not mean every Medicaid provider receives an immediate 10% payment cut. Medicaid
For individuals, the potential consequences are fewer participating providers, longer waits, or reduced availability of particular services if providers cannot replace lost revenue. These are access risks from lower financing, not a statutory cancellation of every affected patient’s benefits. Medicaid
New Medicaid Cost Sharing Begins October 1, 2028
Starting October 1, 2028, states must impose cost sharing on certain expansion adults whose family income exceeds 100% of the federal poverty level. Charges for covered, non-exempt services cannot exceed $35 per service, and aggregate family cost sharing remains limited to 5% of family income. The law does not require a $35 charge for every visit. GovInfo
Primary care, mental health care, substance-use-disorder services, and services at specified community and rural health clinics are exempt from this new requirement. Other existing protections remain, and prescription drugs continue under separate cost-sharing limits. GovInfo
For someone who needs repeated specialist appointments or other non-exempt services, even smaller charges can accumulate. The law also permits states to allow providers to condition certain services on payment of authorized charges. The practical effect will depend on the state’s amounts, covered services, and implementation choices. GovInfo
A New Home-Equity Ceiling Affects Medicaid Long-Term Care in 2028
Beginning January 1, 2028, the maximum allowable home-equity limit for Medicaid long-term services and supports becomes $1 million for non-agricultural homes. States that already use lower limits do not have to raise them to $1 million. The new ceiling is not indexed upward for inflation. Justice in Aging
This provision concerns Medicaid-funded long-term care, not ordinary Medicare eligibility. It can affect an older adult or person with disabilities who has limited income but substantial equity in a home that appreciated over time. In states currently using a higher ceiling, some people could become ineligible for Medicaid long-term-care assistance. Justice in Aging
Important exceptions remain, including protections when a spouse or certain children live in the home, as well as hardship provisions. Agricultural property receives different treatment. The change is not a blanket order requiring every Medicaid beneficiary to sell a home, and families should obtain individualized advice before making property transfers or other financial decisions. Justice in Aging
State Medicaid Demonstration Programs Face a Stricter Approval Requirement
Starting January 1, 2027, CMS’s chief actuary must certify that a new, amended, or renewed Medicaid Section 1115 demonstration is not expected to increase federal Medicaid spending compared with the program without the demonstration. These demonstrations allow states to test alternative approaches to coverage and care. Medicaid
Budget neutrality already existed as federal policy, but the law makes certification a statutory requirement. The change could constrain the services or eligibility approaches states propose. It does not automatically terminate every existing demonstration in January; its effect depends on the program, its financing, and when approval or renewal is sought. Medicaid
Additional Eligibility Checks and State Funding Penalties Phase In
Beginning January 1, 2027, states must strengthen address-information processes and regularly check for deceased beneficiaries. Quarterly deceased-provider checks begin January 1, 2028. A national system addressing enrollment in multiple states, along with tighter rules on federal funding for erroneous excess payments, begins October 1, 2029. Medicaid
These provisions target improper enrollment and payments rather than expressly eliminating covered services. Their individual risk is incorrect matching or records, especially after a move. Correcting an administrative error can become essential to preserving coverage. Medicaid
Certain Legally Present Immigrants Face Medicare Coverage Loss in 2027
The law narrows Medicare eligibility based on citizenship and immigration status. The permitted categories include U.S. citizens and nationals, lawful permanent residents, Cuban or Haitian entrants, and qualifying residents under the Compacts of Free Association. Some people in other lawful humanitarian or temporary immigration categories can lose eligibility despite previously qualifying for Medicare. Centers for Medicare & Medicaid Services
For affected existing beneficiaries, the statute provides an 18-month transition following enactment. CMS’s July 2026 proposed implementation rule would terminate affected existing coverage on February 1, 2027, with notices and appeal rights. That specific operational date remains part of a proposal as of this article’s update; it should not be confused with a finalized nationwide termination notice. Federal Register Public Inspection
This is a direct coverage restriction, not merely a provider-payment adjustment. Someone affected could lose coverage for hospital treatment, physician services, and associated Medicare coverage. The restriction does not exclude all noncitizens: people with qualifying permanent-resident or other permitted status remain subject to the usual eligibility requirements. Federal Register Public Inspection
Low-Income Medicare Beneficiaries May Have More Difficulty Obtaining Help With Costs
The law blocks parts of a rule intended to simplify enrollment in Medicare Savings Programs through September 30, 2034. These Medicaid-funded programs help eligible Medicare beneficiaries pay premiums and, depending on the program, deductibles and other cost sharing. Congressional Budget Office
CBO projected approximately 800,000 fewer people enrolled in Medicaid alongside Medicare in 2034 because of this provision. Most affected people would retain Medicare, but fewer would receive the financial help they otherwise would have obtained. Losing assistance with Medicare costs is different from losing Medicare itself, but it can still make care unaffordable. Congressional Budget Office
A separate moratorium blocks parts of the 2024 Medicaid, CHIP, and Basic Health Program enrollment-simplification rule through September 2034. This preserves administrative barriers that the rule would have reduced, including protections particularly relevant to older adults and people with disabilities. Neither moratorium abolishes the underlying programs. Medicaid
Medicare’s Temporary Physician-Payment Increase Expires After 2026
The reconciliation law provided a one-year, 2.5% increase to Medicare’s physician-payment conversion factor for 2026. That temporary increase expires for 2027. Other payment adjustments partly offset its expiration, so it is inaccurate to describe the resulting payment change as an identical 2.5% cut for every physician or service. Centers for Medicare & Medicaid Services
In its July 2026 proposal, CMS projected conversion-factor decreases of 1.68% for clinicians outside qualifying alternative payment models and 1.19% for qualifying participants. Those are proposed figures, not finalized 2027 rates as of September 30. Centers for Medicare & Medicaid Services
For patients, the concern is whether payment pressure affects appointment availability or provider participation. This does not directly reduce a beneficiary’s covered services by those percentages, nor does it establish that every physician will stop accepting Medicare. Centers for Medicare & Medicaid Services
More Rare-Disease Drugs Are Excluded From Medicare Price Negotiation
The law expands the exclusion from Medicare drug-price negotiation for qualifying “orphan drugs,” which treat rare diseases. The exclusion can now cover drugs approved for multiple rare diseases when all approved indications satisfy the relevant rare-disease criteria, rather than only a single rare disease. CMS incorporated the change into guidance for negotiated prices taking effect in 2028. Centers for Medicare & Medicaid Services
For someone taking an affected medication, the consequence may be the absence or delay of savings that otherwise could have resulted from negotiation. The effect depends on the particular drug and coverage arrangement; it is not a uniform prescription-price increase. The administration describes the change as protecting research incentives. It does not terminate the overall Medicare drug-negotiation program. Centers for Medicare & Medicaid Services
Nursing-Home Staffing Protections Were Rolled Back Before Their Full Phase-In
The law imposed a moratorium through September 2034 on specified federal nursing-home staffing requirements. CMS subsequently repealed the affected standards, effective February 2, 2026. Those standards would have required round-the-clock registered-nurse coverage and specified minimum nursing-care hours, with implementation phased across 2026–2029. Federal Register
This is therefore an already-effective rollback with consequences extending beyond the midterms, not a new January 2027 eligibility cut. Residents retain other federal and state protections, but they will not receive the additional staffing guarantees from the repealed standards. Federal Register
For families, the concern is the amount of hands-on care available and how quickly staff can respond. CMS cited costs and workforce constraints in supporting repeal. The actual effect on an individual resident depends on the facility’s staffing and applicable state requirements. Federal Register
Several Important Changes Begin Before the Midterms
Medicaid Immigration Restrictions Begin October 1, 2026
Federal financing for full Medicaid and CHIP coverage becomes restricted to a narrower set of citizenship and immigration categories on October 1, 2026. Refugees, asylees, and certain other legally present immigrants may lose federally funded full coverage unless they qualify through a permitted status or an applicable exception. Medicaid
Exceptions remain for certain lawfully residing children and pregnant people in states that elected the relevant coverage option. States may also provide state-funded coverage. Consequently, immigration status alone is not enough to determine the result without examining the person’s circumstances and state program. Medicaid
On the same date, the federal matching rate for certain emergency Medicaid services falls from the expansion rate to the state’s regular Medicaid matching rate. This shifts more costs to states; it does not abolish emergency Medicaid. Affected individuals nevertheless may lose the broader coverage needed for ongoing, non-emergency treatment. Medicaid
The Additional Incentive for New Medicaid Expansion Has Ended
States newly expanding Medicaid beginning in 2026 no longer qualify for the additional, temporary five-percentage-point federal matching incentive. This may make expansion less financially attractive in remaining non-expansion states. The standard 90% federal match for the expansion population was not repealed. Medicaid
The Original One-Year Reproductive-Provider Restriction Has Expired
The law’s one-year federal Medicaid funding restriction affecting Planned Parenthood and certain other reproductive health providers expired in July 2026. It should not be described as a new post-midterm cut. Separate state exclusions can still prevent patients from using Medicaid at affected providers, including for contraception and cancer screening. KFF
The Law Also Includes Funding and Coverage Opportunities
The law created a $50 billion Rural Health Transformation Program for fiscal years 2026–2030. States can use approved funding for rural health initiatives, workforce development, technology, and other purposes. This can support local services, but it is not an individual insurance entitlement or a guarantee that a particular hospital will remain open. Centers for Medicare & Medicaid Services
Beginning July 1, 2028, states also gain an optional pathway to provide home- and community-based services to people who do not need an institutional level of care. This could help some people receive assistance earlier, but states must choose to implement the option and obtain approval. It does not guarantee services to everyone on an existing waiting list. Medicaid
What Individuals and Families Should Do Now
Medicaid beneficiaries should ask their state agency which eligibility category they are enrolled in, whether the work requirement applies, and when their next renewal is due. Keeping mailing addresses and contact information current is especially important. People who qualify for an exemption should ask how that exemption will be verified rather than assuming it is already recorded. Centers for Medicare & Medicaid Services
Anyone receiving a denial or termination notice should read the reason, effective date, and appeal instructions immediately. A notice caused by missing information is not necessarily proof that the person is ineligible. People facing major medical bills should apply promptly rather than relying on the older three-month retroactive coverage period. Federal Register
Medicare beneficiaries with limited income should continue applying for Medicare Savings Programs and prescription-drug assistance. These programs still exist. Medicare’s official assistance resources and State Health Insurance Assistance Programs provide help understanding eligibility, bills, coverage choices, and financial assistance; SHIP counseling is free and is not tied to an insurance company. Medicare
The central distinction is between losing insurance, losing help paying for insurance, and facing reduced access because providers receive less funding. All three can harm individuals, but they require different responses. The most useful question is not simply whether Medicare or Medicaid is being cut. It is which provision applies to a particular person, when it applies in that state, and what can be done before coverage or care is interrupted.
This article provides general information, not an individual eligibility determination. State implementation decisions, final regulations, and a person’s circumstances can change the outcome.