As many as 17 million Americans will lose their health insurance and many others will incur more medical debt under the budget bill President Trump signed into law last Friday.
The tax bill, or the “One Big Beautiful Bill Act,” would cut more than $1 trillion in federal spending over 10 years for Medicaid, food stamps, Medicare and other programs, KFF reported. Such deep cuts in federal health spending will jeopardize the physical and financial health of tens of millions of Americans, KFF Health News reported on July 2.
In a June 24 tip sheet, we covered significant parts of the bill after the U.S. House of Representatives passed it on May 22 and sent it to the Senate. Journalists have multiple ways to report on the true human impact of this new legislation. Below are a few angles to consider covering.
3 crucial story angles
First, KFF reported that roughly 17 million Americans will lose their health insurance under the bill Trump signed. Of those 17 million, KFF explained that 11.8 million will lose their Medicaid and Affordable Care Act (ACA) health plans by 2034, and 5.1 million could lose their ACA coverage under changes the federal Centers for Medicare and Medicaid Services announced June 20.
The policies that Trump and the GOP-controlled Congress have enacted will roll back health coverage for the first time since the advent of the modern U.S. health system in the early 20th century, as Renuka Rayasam and Sam Whitehead reported for KFF Health News.
Second, losing health insurance could push 5.4 million Americans into medical debt and increase what consumers owe to hospitals and physicians by $50 billion, a 15% increase from current levels, according to a June 23 report titled “GOP Health Care Cuts: A Recipe for Medical Debt Disaster” from Third Way, a center-left think tank in Washington, D.C.
Third, the combination of high medical debt and no health insurance could lead to increased deaths among millions of underserved Americans. For each state, the Third Way report estimates the number of consumers who would lose their coverage, the number of people who would have medical debt and the total amount owed in such debt.
Rising medical debt
Nearly 30% of Americans (100 million) carry medical debt, the Third Way report showed, citing federal census data. Those consumers are unable to pay $269 billion in bills from physicians, hospitals and others who deliver health care, Third Way noted, citing this 2024 Peterson-KFF Health System Tracker report: “The burden of medical debt in the United States.”
Such a high level of unpaid bills means hospitals, physicians and other providers struggle to continue normal operations, the report showed. Even the roughly 60% of Americans who do not have medical debt worry that medical bills will overwhelm their budgets if they get sick or have an accident, the report added.
More health insurance equals less debt
“The treatment for medical debt is adequate health insurance coverage,” the Third Way report states. Having such coverage protects consumers by giving them access to care to help them stay healthy and avoid unpredictable costs, the authors write.
David Kendall, one of the report’s authors, said in an interview that census data show medical debt declined as more Americans gained health insurance coverage from 2017 through 2022.
The authors included data from a 2013 article in the New England Journal of Medicine, “The Oregon Experiment — Effects of Medicaid on Clinical Outcomes,” showing that Medicaid coverage nearly eliminated catastrophic out-of-pocket medical expenditures.
“The beauty of the Oregon study is that it’s a randomized, controlled trial in which they found a strong relationship between Medicaid coverage and reduced medical debt,” Kendall said. “We just extrapolated from that data.”
The Third Way report also showed that the Republican budget bill will increase the number of people in families with medical debt by 5.4 million. Of those 5.4 million, 2.2 million more households will have medical debt specifically because they lost their Medicaid coverage. And the ACA cuts will lead to 3.2 million more people with medical debt, the report added.
Families that have no medical debt would need to take on as much as $22,800 in medical debt if they lose their coverage, the report showed. Families that already have medical debt carry an average of $13,490 and would add an average of $8,790 in new medical debt, the authors wrote.
Insurance also means fewer deaths
Recent research showed that Medicaid coverage helps keep Americans healthy and saves lives, as Alana Semuels reported in this May 7 TIME article,“Medicaid Expansions Saved Tens of Thousands of Lives, Study Finds.”
After the ACA allowed states to expand eligibility for Medicaid enrollment, those who enrolled in Medicaid had a 20% reduced risk of death when compared with people in states who could not access Medicaid, Semuels wrote, citing a May 5 study from the National Bureau of Economic Research. That study showed that expanding Medicaid enrollment saved about 27,400 lives between 2010 and 2022, she reported.
In the study, researchers tracked nearly 40 million people who gained Medicaid through state-based expansions under the ACA between 2010 and 2022. In those years, the states that expanded enrollment in Medicaid reduced Medicaid members’ risk of death by 2.5%, which suggested a 21% reduction in the risk of death among new enrollees, the NBER report authors wrote.
Other researchers also showed that Medicaid coverage leads to fewer deaths. Writing in the Annals of Internal Medicine, researchers Adam Gaffney, M.D., David U. Himmelstein, M.D., and Steffie Woolhandler, M.D., estimated that the number of deaths from the House-passed version of the bill could range from 8,241 to 24,604. That article, “Projected Effects of Proposed Cuts in Federal Medicaid Expenditures on Medicaid Enrollment, Uninsurance, Health Care, and Health,” was published June 17.
Medicaid is the nation’s single largest health insurer, covering 78.4 million Americans (about 23% of the population), including 71.3 million adults in Medicaid and 7.3 million young people in the Children’s Health Insurance Program, according to KFF. Its funding comes from the federal and state governments.
Medical debt at crisis levels
In an interview, Sara R. Collins, Ph.D., a senior scholar and vice president at The Commonwealth Fund, said medical debt is already at crisis levels, and the budget bill could exacerbate that problem by raising out-of-pocket limits for people with health insurance.
Through focus groups, the Commonwealth Fund learned that consumers say out-of-pocket costs are already too high. “High deductibles just leave people with bills they can’t pay right away,” Collins said.
The budget bill could cause two problems, she added. First, rising deductibles mean health insurance doesn’t cover costs as well as it once did, and second, millions could lose their health insurance completely, she added.
“About 25% of people who are insured all year and have all different kinds of health insurance have such high out-of-pocket costs relative to their income that they’re underinsured,” she said. “We know from our survey data that if you’re underinsured, you already have higher rates of medical debt.
“As proposed, the bill in Congress would actually lead to more people being underinsured and we know that being uninsured leads to medical debt and it also leads to death,” Collins added. In an article for Kaiser Health News, Phil Galewitz, Julie Appleby, Renuka Rayasam and Bernard J. Wolfson reported that under the budget bill, many Medicaid enrollees will pay more out-of-pocket for medical appointments. Medicaid enrollees now often pay nothing for medical care because studies show even small copayments lead low-income adults to avoid such treatment.
But for Medicaid members in states that have expanded Medicaid, the budget bill would require enrollees to pay as much as $35 for some services if their incomes are between the federal poverty level ($15,650 for an individual) and 138% of that amount ($21,597), Kaiser Health News added. The policy will not apply to people seeking primary, mental health or substance abuse care, they noted.
Resources
- What Health Care Provisions of the One Big Beautiful Bill Act Mean for States, National Association of State Health Plans, July 8.
- Republican Megabill Will Mean Higher Health Costs for Many Americans, Kaiser Health News, July 3.
- Tax Cuts Now, Benefit Cuts Later: The Timeline in the Republican Megabill, The New York Times, July 2.
- Allocating CBO’s Estimates of Federal Medicaid Spending Reductions Across the States: Senate Reconciliation Bill, KFF, July 1.
- Medicaid, food aid recipients worry about safety net cuts in bill sent to Trump, AP, July 3.
- In a first, Trump and GOP-led Congress Prepare to Swell Ranks of U.S. Uninsured, Kaiser Health News, June 30.
