The Big Beautiful Bill Impact

The “Big Beautiful Bill” Impact: Medicaid Cuts, SNAP Changes, Work Requirements, and Timeline

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The “One Big Beautiful Bill Act” (OBBBA), signed into law by President Donald Trump on July 4, 2025, is a sweeping reconciliation bill that reshapes federal safety net programs, including Medicaid and the Supplemental Nutrition Assistance Program (SNAP). This legislation, passed to fund tax cuts and other priorities, imposes significant cuts, new eligibility requirements, and administrative changes, raising concerns about increased hunger and uninsurance.

Below, we address the impact on Medicaid and SNAP, focusing on cuts, SNAP-specific changes, new work requirements, the scale of SNAP cuts, and their implementation timeline, with references to California’s CalFresh program where relevant. Use the SNAP Eligibility Calculator to estimate your eligibility under the new rules.

Are There Cuts to Medicaid Because of the “Big Beautiful Bill”?

Yes, the OBBBA includes substantial cuts to Medicaid, totaling approximately $1 trillion over 10 years through 2034, according to the Congressional Budget Office (CBO). These cuts, the largest in Medicaid’s history, aim to reduce federal spending to offset tax breaks, primarily benefiting high-income earners.

The cuts will affect millions of low-income Americans, including children, seniors, people with disabilities, and those in rural areas, by reducing coverage and increasing out-of-pocket costs.

Key Medicaid Cuts and Changes

  1. Funding Reductions: The CBO estimates a $1.02 trillion cut to Medicaid and the Children’s Health Insurance Program (CHIP), with $326 billion from work requirements, $191 billion from limits on state provider taxes, and $149 billion from restrictions on state-directed payments. These reductions will lead to an estimated 17 million people losing coverage by 2034, including 10.9 million due to work requirements and other provisions.
  2. Work Requirements: Starting January 1, 2027 (with states able to implement earlier), adults aged 19–64 with incomes between 100% and 138% of the federal poverty level (FPL) ($15,060–$20,772 for an individual in 2025) must work, volunteer, or attend school for at least 80 hours per month to maintain eligibility. Exemptions apply for pregnant individuals, those with disabilities, caregivers of children under 14, or those in high-unemployment areas (over 8% or 1.5 times the national rate). However, frequent reporting (every 6 months or monthly, depending on the state) may lead to coverage losses due to administrative burdens. For example, Arkansas’s prior work requirement experiment resulted in 18,000 people losing coverage without significant employment gains.
  3. Increased Eligibility Checks: Starting December 31, 2026, states must conduct Medicaid eligibility redeterminations every six months instead of annually, increasing the risk of coverage loss due to missed paperwork. This is particularly challenging for seniors and those with limited resources.
  4. Immigrant Restrictions: Starting October 1, 2026, noncitizens (except lawful permanent residents, children, or pregnant women) are barred from Medicaid, even in states like California that use state funds to cover undocumented immigrants. This could affect 1.4 million people nationwide, with California’s Medi-Cal program facing a 10% reduction in federal matching funds for expansion states covering noncitizens.
  5. Reduced Retroactive Coverage: As of December 31, 2026, retroactive coverage drops from three months to one month for expansion enrollees and two months for traditional enrollees, increasing medical debt risks for vulnerable groups like pregnant women and seniors.
  6. Increased Out-of-Pocket Costs: Starting October 1, 2028, copays rise for recipients above the FPL ($15,060 for an individual), potentially deterring care for low-income households.
  7. Provider Funding Restrictions: The bill limits state provider taxes and directed payments, reducing revenue for hospitals and clinics, particularly in rural areas. Despite a $50 billion rural hospital relief fund over five years, experts predict closures due to insufficient funding, with 44% of rural hospitals already operating at negative margins in 2023.

Impact on California’s Medi-Cal

In California, where Medi-Cal covers over 14 million people (including 4 million in Texas-like states), the cuts could lead to 1.7 million residents losing coverage, raising the state’s uninsurance rate from 6% to over 10%. Rural areas and regions like the Rio Grande Valley, with high Medicaid reliance, face disproportionate impacts. The loss of retroactive coverage and increased copays may increase medical debt, while administrative costs for verifying work requirements could strain state budgets.

How Will the “Big Beautiful Bill” Change SNAP?

The OBBBA introduces significant changes to SNAP, undermining its role as the nation’s primary anti-hunger program. These changes, affecting over 42 million participants, include stricter eligibility, reduced benefits, and new administrative burdens, with a focus on cost-cutting and work promotion. In California, CalFresh serves 5.38 million people, and these changes could disrupt access to food assistance.

Key SNAP Changes

  1. State Cost-Sharing: Starting in fiscal year 2028, states must pay 5–15% of SNAP benefit costs, depending on their payment error rates (10.9% national average in 2024, with 43 states above 6%). States with error rates above 13.3% may delay until 2029 or 2030. Additionally, states’ administrative cost share rises from 50% to 75%, costing California an estimated $89.5 million annually. States unable to fund these costs may reduce benefits or exit SNAP, potentially ending the program in some regions.
  2. Utility Allowance Reductions: Approximately 600,000 households, including 500,000 with children, will lose an average of $100 monthly due to changes in utility expense calculations. Households must now submit actual utility bills instead of using a standard utility allowance (SUA), unless they include elderly or disabled members. This change, effective upon USDA guidance (likely in 2026), reduces shelter deductions, lowering benefits.
  3. Thrifty Food Plan (TFP) Restrictions: The TFP, which sets SNAP benefit amounts, is limited to cost-neutral updates, preventing increases beyond inflation. In 2024, SNAP benefits failed to cover a modestly priced meal in 99% of counties, and this restriction will widen the gap, reducing purchasing power. For example, the maximum CalFresh benefit for a family of four ($975) may not keep pace with rising food costs.
  4. Immigrant Eligibility Restrictions: Starting October 1, 2026, SNAP eligibility is limited to U.S. citizens and lawful permanent residents, excluding refugees, asylees, and humanitarian parolees (except Cubans and Haitians after revisions). This could affect 60,000–125,000 people nationwide, including many in California’s diverse communities.
  5. Expanded Work Requirements: Detailed below, these requirements extend to more recipients, risking benefit losses for millions.
  6. Elimination of SNAP-Ed: The Nutrition Education and Obesity Prevention Grant Program (SNAP-Ed) is defunded, ending nutrition education and physical activity promotion, effective immediately upon USDA guidance.
  7. National Accuracy Clearinghouse (NAC) Expansion: The NAC, used to prevent duplicate SNAP participation across states, will extend to other programs like Medicaid, reducing federal spending by $7 billion through 2034. This aims to improve program integrity but may increase administrative burdens.

Impact on California’s CalFresh

California’s CalFresh program faces significant challenges, with 645,000 recipients (11%) at risk of losing benefits. The state must cover $705 million annually to maintain benefits, straining budgets already facing a $770 million transit shortfall.

Urban areas like Los Angeles and San Francisco, with high living costs, will see reduced purchasing power, while programs like Market Match (doubling EBT dollars at farmers’ markets) may decline. Administrative costs for verifying work requirements could reach $500 million annually, potentially leading to stricter eligibility enforcement.

What Are the New Work Requirements for SNAP?

The OBBBA expands SNAP work requirements, affecting a broader group of recipients and increasing the risk of benefit loss. Previously, able-bodied adults without dependents (ABAWDs) aged 18–54 were limited to three months of benefits every three years unless working 20 hours per week or meeting exemptions. The new rules are stricter and broader.

New SNAP Work Requirements

  1. Age Expansion: The ABAWD work requirement now applies to adults aged 18–64, up from 54, affecting 900,000 adults aged 55–64 and 270,000 veterans nationwide.
  2. Parental Requirements: Parents with children aged 14 or older (previously exempt if caring for children under 18) must now work, volunteer, or participate in training for 20 hours per week. This impacts 800,000 parents of school-aged children.
  3. Verification and Compliance: States must verify work status at least every six months, with some opting for monthly checks. Noncompliance results in benefit loss after three months, though states may enforce shorter periods. Activities include paid employment, volunteering, or approved training programs (e.g., California’s Employment Development Department programs).
  4. Exemptions: Exemptions remain for those under 18, over 64, pregnant, disabled, caring for children under 14, or living in high-unemployment areas (over 8% or 1.5 times the national rate). However, proving exemptions (e.g., disability or caregiving) requires documentation, and administrative errors or delays may lead to coverage loss.
  5. Impact: The CBO estimates 3.2 million adults, including 2 million children in their households, will lose some or all benefits monthly due to these requirements. For example, a single mother with a 14-year-old in California losing benefits for herself would see CalFresh drop from $536 to $292 monthly.

California Context

California’s high-unemployment counties may qualify for waivers, but urban areas with lower unemployment rates will face stricter enforcement. The state’s $500 million annual cost to implement verification systems could lead to aggressive eligibility checks, disproportionately affecting working families who fail to submit timely paperwork.

How Big Are the SNAP Cuts?

The OBBBA imposes SNAP cuts of $186 billion through 2034, according to the CBO, representing a 20% reduction in program funding—the largest in SNAP’s history. The Urban Institute estimates 22.3 million families, including 5.3 million working families, will lose some or all benefits, with an average monthly loss of $146 per affected household.

Breakdown of SNAP Cuts

  1. Work Requirement Losses: Over 3.2 million adults, including 2 million children in their households, will lose benefits due to expanded work requirements, contributing significantly to the $186 billion reduction.
  2. Utility Allowance Reductions: 600,000 households will lose an average of $108–$146 monthly due to revised utility calculations, impacting 500,000 children.
  3. TFP Restrictions: Cost-neutral TFP updates will prevent benefit increases, reducing purchasing power as food costs rise. In 2024, SNAP benefits fell $53.01 short of monthly meal costs per person, and this gap will grow.
  4. State Cost-Sharing: States covering 5–15% of benefits could reduce eligibility or benefits if unable to fund costs, potentially cutting benefits for millions more. California’s $705 million annual share exemplifies this burden.
  5. Immigrant Exclusions: 60,000–125,000 noncitizens will lose benefits, contributing to overall savings.

California Impact

In California, 645,000 CalFresh recipients (11% of participants) could lose benefits, with urban households facing a $146 average monthly reduction. The state’s high cost of living exacerbates the impact, as the maximum benefit ($975 for a family of four) already fails to cover meal costs in 99% of counties.

When Will These Changes to SNAP Happen?

The SNAP changes are phased in over several years, with some taking effect sooner based on USDA guidance or state implementation. Below is the timeline based on available data:

  • Immediate (Post-July 4, 2025):
    • SNAP-Ed Defunding: Nutrition education programs end upon USDA guidance, likely by late 2025 or early 2026.
    • Utility Allowance Changes: States will implement revised utility calculations upon USDA guidance, likely in 2026, reducing benefits for 600,000 households.
  • October 1, 2026:
    • Immigrant Eligibility Restrictions: Noncitizens (except lawful permanent residents, Cubans, and Haitians) lose eligibility, affecting 60,000–125,000 people.
  • Fiscal Year 2028 (October 1, 2027):
    • State Cost-Sharing: States begin paying 5–15% of SNAP benefit costs, with administrative cost shares rising to 75%. States with high error rates (>13.3%) may delay to 2029 or 2030.
  • Ongoing:
    • Work Requirements: States may implement expanded requirements (ages 18–64, parents with children 14+) as early as 2026, with mandatory enforcement by 2027. Verification occurs at least biannually, with some states opting for monthly checks.
    • TFP Restrictions: Cost-neutral updates apply immediately, limiting benefit increases annually.
  • Administrative Adjustments: States must update systems for work verification and NAC expansion by 2027, with California facing $500 million in annual costs.

California Timeline

California may delay cost-sharing until 2029 if error rates remain high (10.9% in 2024). However, work requirements and utility changes could start in 2026, depending on state readiness. Check BenefitsCal.com or contact your county office (www.cdss.ca.gov/county-offices) for updates.

Economic and Social Consequences

The combined Medicaid and SNAP cuts could lead to significant economic and social impacts:

  • Job Losses: The Commonwealth Fund estimates 1.2 million job losses nationwide by 2029 due to reduced healthcare and food spending, with state GDPs falling by $154 billion.
  • Food Insecurity: With 13.5% of U.S. households food insecure in 2023, SNAP cuts could exacerbate hunger, particularly for 2 million children. California’s food banks, like the Greater Chicago Food Depository, report a 60% demand increase, unable to fill the gap.
  • Healthcare Access: Medicaid cuts will increase uninsurance, raising medical debt and straining safety net providers. Rural hospital closures are projected, with California’s rural areas particularly vulnerable.

Perspectives on the Bill

  • Supporters (e.g., Rep. Buddy Carter, Sen. John Cornyn): Argue the bill reduces fraud, promotes work, and protects programs for the truly needy (children, disabled, pregnant women) while funding tax cuts for economic growth. They claim improper Medicaid payments ($56 billion annually) and low SNAP work rates (28% of able-bodied adults) justify reforms.
  • Critics (e.g., Rep. Hakeem Jeffries, Gov. JB Pritzker): Warn of increased hunger, poverty, and uninsurance, accusing the bill of prioritizing tax breaks for the wealthy (e.g., $1 trillion for the top 1%) over vulnerable populations. They cite bipartisan public opposition to cuts and predict rural hospital closures and strained food banks.

How to Stay Informed and Protect Benefits

To navigate these changes:

  • Monitor Status: Check CalFresh status on BenefitsCal.com, the EBT Edge app, or by calling 1-877-328-9677. Contact county offices (www.cdss.ca.gov/county-offices) for application or recertification updates.
  • Submit Documents Promptly: Provide income, work, or exemption proof to avoid benefit loss. Report changes (income, household size) within 10 days.
  • Appeal Denials: Request a fair hearing within 90 days via BenefitsCal or county offices if benefits are denied.
  • Explore Alternatives: Contact 211 California (211ca.org) for food bank support or emergency CalFresh (within 3 days for urgent cases).

Frequently Asked Questions (FAQs)

Are Medicaid cuts immediate?

No, most cuts (e.g., work requirements, eligibility checks) begin in 2026 or 2027, with out-of-pocket cost increases in 2028. Rural hospital impacts may emerge sooner due to provider funding cuts.

How will CalFresh benefits change?

CalFresh recipients may see reductions averaging $146/month due to utility allowance cuts, TFP restrictions, and work requirements. 645,000 Californians could lose benefits entirely.

Who is affected by SNAP work requirements?

Adults aged 18–64, parents with children 14+, and veterans must work 20 hours/week or lose benefits after three months, unless exempt (e.g., disabled, pregnant).

How big are the SNAP cuts?

SNAP faces $186 billion in cuts through 2034, affecting 22.3 million families with an average $146 monthly loss. California’s share impacts 645,000 recipients.

When do SNAP changes start?

Utility and SNAP-Ed changes begin in 2026, immigrant restrictions in October 2026, and state cost-sharing in 2028 (or 2029–2030 for high-error states). Work requirements may start in 2026.

Conclusion

The “Big Beautiful Bill” imposes historic cuts of $1 trillion to Medicaid and $186 billion to SNAP through 2034, introducing work requirements, state cost-sharing, and eligibility restrictions that could leave 17 million uninsured and 22.3 million families with reduced food assistance. In California, 645,000 CalFresh recipients and 1.7 million Medi-Cal enrollees are at risk, with rural and urban areas facing increased hunger and medical debt.

Stay proactive by monitoring your status on BenefitsCal.com, submitting required documents, and exploring alternatives like food banks. For eligibility estimates, use the SNAP Eligibility Calculator or review California SNAP Income Limits.

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