By Joanne Bump
The U.S. House passed the “One Big, Beautiful Bill” with many changes that impact retirees. The bill is before the U.S. Senate but it’s losing the momentum to pass it by the July 4 deadline. The bill includes language to raise the debt ceiling by $4 trillion, extending the federal government’s authority to borrow, according to The Hill. The Congressional Budget Office (CBO), an agency designed to provide lawmakers with objective information about the budgetary impact of proposed bills, says the House-passed bill adds $2.4 trillion to the deficit and $3.75 trillion to renew tax cuts, primarily for the wealthy over the decade.
The bill includes Medicaid cuts of $698 billion over ten years and would possibly remove 16 million people from enrollment in Medicaid, according to the June 4 estimates from the CBO. The House-passed version also includes a $267 billion reduction to spending for the Supplemental Nutrition Assistance Program (SNAP).
The administration has incorrectly said it’s not cutting anything meaningful but only trims “waste, fraud and abuse.” However, according to a June 2 New York Times article, most of the reductions are not credibly focused on waste, fraud, or abuse. According to Edwin Park, a professor at Georgetown University, examples of provisions that aren’t aimed at waste, fraud, and abuse include allowing states to enact mandatory co-payments for specific medical services, blocking a rule that would raise nursing home staff requirements, and curtailing the time for retrospective payments.
The greatest single savings of $280 billion is a new Medicaid requirement to show proof of employment. This would be a fundamental change which has historically linked Medicaid eligibility to income, not employment. Those promoting work requirements see it as a way to weed out the non-working from the needy. They don’t address the obstacles to work like lack of funding for health care, transportation, and child care. According to the Kaiser Family Foundation (KFF), research shows access to affordable health insurance and care promotes individuals’ ability to obtain and maintain employment. KFF also concludes that Medicaid work and reporting requirements are confusing to enrollees and complex and costly for states to implement.
Approximately 64 percent of adult recipients already work part-time or full-time, and recipients who are not working can still qualify for Medicaid. Many not working face barriers to work. Most working Medicaid recipients earn low wages and are employed by small firms in industries that have low employer-sponsored insurance offer rates. Medicaid recipients may be working, but their income is too low to buy health insurance. See “Work Status & Barriers to Work Among Medicaid Adults, 2023” chart below.
Medicare Cuts Too – Medicare is the health insurance that most defined benefit State employee retirees and their dependents and survivors will rely on through the Medicare Advantage plan. The administration pledged not to cut Medicare, but reductions to Medicare can occur without changing the existing law. Under the Federal Statutory PayAsYouGo Act of 2010 (S-PAYGO), a trigger law already exists to set off a procedure known as sequestration or the cancellation of budgetary resources based on a preset formula. These proposed large deficits are estimated to trigger $535 billion in cuts to Medicare over the decade.
Affordable Care Act (ACA) or Obamacare – Without changing the law, the administration is also considering changes to the rules making the ACA insurance more expensive while paying for less. Those who fail to meet the work requirement imposed by Medicaid would also be blocked from receiving subsidies for private plans sold on the marketplace. By adding paperwork requirements, the bill would make it more difficult to access insurance and qualify for tax credits. Some Obamacare funding is going to expire at year-end and the administration doesn’t plan to extend it. The CBO projects than an estimated 4.3 million Americans would lose health insurance.
Michigan SNAP Benefits – Michigan’s SNAP program totals $3.2 billion. The proposed changes, requiring the State to pay for some of the SNAP benefits, are estimated to cost Michigan up to $800 million. They would increase the maximum age for work requirements from 54 to 64 and limit the State’s ability to waive the requirements. About 15 percent of Michigan residents, or nearly 1.5 million people, get SNAP. This includes over 59 percent from families with children, 39 percent from families with older adults or the disabled, plus 41,000 veterans. Since 67 percent of Michigan’s SNAP recipients are also covered by Medicaid, many will be experiencing reductions from both federal benefits at once. The result is that more Michigan residents will be seeking nutrition from food banks when the need may be greater than the food available.
People’s Town Hall – U.S. Sen. Elissa Slotkin and U.S. Rep. Kristen McDonald Rivet took questions in Lansing on Friday, June 6. They spoke to an audience of about 300 about the administration’s cuts to Medicaid and SNAP. McDonald Rivet said: “…What it really does is it takes away health care. It raises the cost of medicine, it raises the cost of education, it raises the cost of energy. And in doing that, making everything more expensive for people in this room, it gives an enormous tax break to the uber-wealthy in our country.” Slotkin mentioned that the bill would require people to enroll in Medicaid every six months instead of once a year and prove their work status more frequently. It is designed to make it so difficult to receive benefits that people would stop applying. “This bill is designed to really be a perfect storm for poor people,” Slotkin said. “If you are living at or below the poverty line, you’re getting hit in every direction. Medicaid, your health care, SNAP, your food, a bunch of programs that you depend on, like the Job Corps program – gone. The perfect storm is a real thing. In this bill, they are paying for those tax benefits for the most wealthy by really the perfect storm of cuts for the poorest among us.”
(Editor’s Note: Joanne Bump serves as feature columnist for “Retirement Matters.” Column content is time sensitive and is based on information as of 6/8/25. Joanne can be contacted by e-mail at joannebump@gmail.com.)