The One Big Beautiful Bill (OBBB) enacts some of the most substantial health policy reforms ever, largely by reversing reckless Biden administration policies. The legislation will reduce waste, fraud, and corporate welfare in Medicaid and in the Obamacare exchanges while returning those programs to their original mission: helping the poor and vulnerable.
Breaking Down False Figures from the Critics
One main attack on the OBBB is that it would result in upwards of 16 million Americans losing their health coverage. This is a bogus claim. Here is how this number breaks down, using the Congressional Budget Office’s (CBO) estimates:
1.4 Million Illegal Immigrants: Some states voluntarily provide taxpayer-funded health care for millions of unauthorized immigrants, often with federal funding obtained through money-laundering schemes. Although cuts to these provisions did not make it into the final Senate draft because of Senate parliamentarian rules around reconciliation, such programs are a gross misuse of taxpayer dollars.
4.8 Million Who Don’t Meet Modest Community-Engagement Requirements: OBBB places modest community-engagement requirements on able-bodied, working-age enrollees to work, learn, or volunteer at least 20 hours a week to be eligible for Medicaid. CBO projects that many will not meet these basic requirements.
1.6 Million Not Eligible: CBO estimates that increasing eligibility checks for able-bodied, working-age Medicaid expansion enrollees would result in the removal of some ineligible people from the program. Many of these people have other options for sources of coverage too. This figure is not surprising since we estimate 6.6 million people were improperly enrolled in Medicaid expansion in 2024. Some groups looking to inflate the coverage loss number fail to acknowledge that CBO counts coverage loss for the same person in more than one category.
3.1 Million Improper Obamacare Exchange Enrollees: We estimate that there are 6.4 million ineligible exchange enrollees in part because of Biden administration policies that prioritized enrollment over eligibility verification. The OBBB would require exchanges to verify eligibility for new enrollees as well as re-enrollees and would limit the amount of advanced subsidies people could claim without penalty, if they misreported their income. CBO projects that these commonsense program-integrity measures would result in coverage loss of people who are not eligible for the program.
4.2 Million from Ending Enhanced Subsidies: The coverage loss numbers include the effects of the expiring Biden COVID credits, or the enhanced exchange subsidies to health insurers. This is an issue completely unrelated to the OBBB. Congressional Democrats sunset the Biden COVID credits in the reconciliation bill that they passed in 2022 without any Republican support. The Biden COVID credits, which led to fully-subsidized plans and large incentives to cheat, fueled much of the fraudulent enrollment in Obamacare exchanges.
CBO’s Estimates of Coverage Loss are Likely Inflated
These numbers are likely overestimates since they rely on projections from the Congressional Budget Office (CBO), which has a poor track record of projecting coverage effects of legislation. Most notably, CBO projected coverage loss from eliminating the individual mandate tax penalty under the Affordable Care Act (ACA) between 10 and 20 times what actually resulted. It is also important to recognize that CBO has not properly accounted for the more than 10 million ineligible enrollees in Medicaid expansion and the ACA exchanges.
As the OBBB takes effect, we must keep in mind that verifying eligibility and eliminating fraud doesn’t mean that those who lose coverage have no options. Millions will have access to subsidized exchange plans or employer coverage. In fact, of those leaving Medicaid, some 1.6 million people will opt-out of these alternatives, indicating the low value they place on coverage. Efforts in the OBBB to eliminate waste, fraud, and abuse in Medicaid and Obamacare exchanges move toward properly restoring these programs for the truly vulnerable.
