Advocacy and Legal Update

Budget Reconciliation Bill Moves to Senate – Significant Impacts to Health Coverage

by Artemis Policy Group

On May 22, 2025, the House passed H.R. 1, the “One, Big Beautiful Bill Act,” by the narrowest of margins (215-214), basically along party lines. Using a Congressional tool known as budget reconciliation, this legislation seeks to advance the President’s tax, defense, and border policy priorities, offsetting the cost of those priorities in large part with cuts to Medicaid and other federal health spending.

The Congressional Budget Office estimates that 16 million individuals will lose coverage due to the Medicaid and ACA provisions in the House-passed bill. The following health policies in the bill are of significant concern:

Medicaid

• The bill would impose mandatory nationwide work reporting requirements on childless, non-disabled adults covered by Medicaid (“Medicaid expansion population”). These requirements would go into effect December 31, 2026;
• The bill would mandate cost-sharing (for services and prescription drugs) for the Medicaid expansion population;
• The bill would repeal streamlined redetermination and enrollment processes for Medicaid;
• The bill would limit Medicaid expansion states’ use of provider taxes as a funding mechanism for states’ share of Medicaid costs;
• The bill would reduce the federal matching percentage for the Medicaid expansion population in states that use state money to provide benefits to immigrants;

Affordable Care Act/Marketplace Plans

• Notably, the bill takes no action to extend the enhanced advance premium tax subsidies (APTCs) that expire at the end of 2025. (The enhanced APTCs, enacted during the pandemic, make premium subsidies more generous.) Expiration of those enhanced APTCs is projected to cause Marketplace premiums to increase by an average of 75%, resulting in a loss of insurance for 4.4 million people.
• The bill codifies a number of policies that narrow eligibility for APTCs and limit opportunities to enroll in Marketplace insurance: shortening the annual open enrollment period, eliminating certain special enrollment opportunities, denying or clawing back APTCs from certain Marketplace purchasers.
• In another technical but significant policy change, the bill eliminates the practice of “silver-loading.”1 This change will lower premiums for silver Marketplace plans but in so doing will reduce APTCs for all who receive them, since APTCs are indexed to the cost of silver plan premiums – effectively raising premium costs for all subsidized purchasers.

340B and PBMs

• The bill would prohibit spread pricing in state Medicaid contracts with PBMs and managed care organizations, requiring transparent pass-through pricing based on ingredient cost plus a dispensing fee.
• 340B covered entities could be paid above actual ingredient cost but would have to report their margins to HHS.
• HHS would publish, at least yearly, a report detailing the aggregate amount of payments in excess of actual ingredient cost to all non-hospital 340B covered entities in a state.

What Happens Next

The bill now moves to the Senate. We anticipate that the Senate will want to change many aspects of the legislation. Put simply, much is in flux and there are still opportunities and a need for engagement.