Medicaid Cuts in Reconciliation Bills to Raise Costs for 1.3 Million Dual-Eligible Beneficiaries

On May 22, the U.S. House passed the One Big Beautiful Bill Act, a reconciliation measure aiming to extend expiring tax cuts by reducing Medicaid spending. The Congressional Budget Office (CBO) estimates this legislation will cut federal Medicaid expenditures by $793 billion over ten years, resulting in 10.3 million fewer enrollees by 2034. Critically, 1.3 million low-income Medicare beneficiaries, known as dual-eligible individuals, would lose Medicaid coverage. This loss stems from provisions delaying or prohibiting Biden-era rules designed to streamline enrollment and reduce administrative barriers, such as automatic enrollment in Medicare Savings Programs and simplified renewal processes. Without Medicaid, these beneficiaries retain Medicare but face increased out-of-pocket costs for premiums, cost-sharing, and supplemental benefits like long-term care and dental services. The Senate's version of the bill similarly restricts these administrative simplifications. Analysts warn that reinstating bureaucratic hurdles, such as in-person interviews and paper documentation requirements, will disproportionately affect vulnerable populations with fixed incomes, potentially making healthcare unaffordable for millions of elderly and disabled Americans.