Breaking down uninsured numbers under Trump's spending law

Medicaid to see the greatest enrollment decline

The spending law targeted Medicaid spending and enrollment in particular. As a result, Medicaid is slated to see the greatest decline in enrollment numbers compared to Medicare and the Health Insurance Marketplaces, according to the latest CBO projections.

CBO estimated 7.5 million people would become uninsured by 2034 due to Medicaid policy changes under the spending law. That number represents three-quarters of the total 10 million slated to lose insurance under the law.

In comparison, Medicare policy changes would result in about 100,000 more uninsured people by 2034. Meanwhile, policy changes to the Health Insurance Marketplaces would lead to 2.1 million more uninsured people over the next decade.

Interactions among policies would also result in 300,000 more uninsured, CBO reported.

Key Medicaid policies contributing to uninsured numbers

Several Medicaid policy changes in the spending law will contribute significantly to the growing uninsured population within the next decade.

First, the largest contributor to the uninsured population by 2034 would be Medicaid work requirements, referred to as "community engagement" requirements in the law. The mandatory work requirements would contribute to 5.3 million uninsured by 2034, CBO projected.

Section 71119 of the spending law establishes Medicaid work requirements for certain adult individuals eligible for Medicaid under the Affordable Care Act's expansion rules. To maintain Medicaid coverage, these individuals must complete at least 80 hours per month of qualifying activities, including paid employment, workforce training, community service and/or half-time education.

The spending law essentially eliminates state discretion to implement work requirements previously administered under Section 1115 demonstration waivers. The law requires states to implement work requirements by January 1, 2027.

The second highest contributor to the uninsured number is provider tax changes, as detailed in Section 71115, which would lead to 1.1 million uninsured by 2034, CBO reported.

Through Section 71115, the Trump Administration aims to stop "abusive finance practices" by limiting the use of state taxes to finance their share of Medicaid costs. In particular, the spending law restricts the use of taxes that enable providers to recoup the money through Medicaid payments and prohibits these "hold harmless" arrangements in new taxes after July 4, 2025.

Thirdly, Medicaid eligibility redeterminations would lead to 0.7 million insured individuals by 2034. As detailed in Section 71107, states must more frequently conduct eligibility redeterminations, with Medicaid expansion states having to review eligibility for beneficiaries qualifying under expansion rules every six months.

Finally, the moratorium on implementing a rule related to eligibility and enrollment for Medicaid, the Children's Health Insurance Program and the Basic Health Program would lead to 0.4 million uninsured by 2034. The rule finalized under the Biden Administration seeks to streamline enrollment in these programs by eliminating barriers and simplifying requirements, including preventing renewals more often than every year, using pre-populated renewal forms and allowing at least 30 days for individuals to return documentation for renewal.

Section 71102 pushes implementation of the rule to October 1, 2034.

Major Marketplace changes contributing to the uninsured rate

While Medicaid is staring down major changes to enrollment, the spending law will also significantly impact Health Insurance Marketplaces. Based on the CBO analysis, the major Marketplace changes by impact through 2034 include:

• Permitting the premium tax credit for only specific individuals (Section 71301), which will lead to 0.9 million more uninsured people.
• Requiring eligibility verification for the premium tax credit (Section 71303), resulting in 0.7 million additional uninsured people after its implementation in 2028.
• Disallowing the premium tax credit in case of certain coverage enrolled in during special enrollment periods (Section 71304), leading to 0.4 million additional uninsured people.
• Disallowing the premium tax credit during periods of Medicaid ineligibility because of alien status (Section 71302), creating 0.3 million additional uninsured people.
• Eliminating the limitation on recapture of advance payment of premium tax credits (Section 71305), leading to 0.1 million additional uninsured people.

Collectively, these Marketplace policy changes will result in about a fifth of the total projected increase in uninsured individuals under the law.

More individuals will also lose access to subsidized healthcare under these policies. CBO projected the share of people with access to federally subsidized health insurance to decrease from 53% in 2026 to 37% by 2034.

Uninsured rate to ramp up in 2026, accelerate in 2029

The spending law will lead to a massive increase in the uninsured population within ten years, but CBO expects the number to rapidly climb to a total of 10 million people.

Over the next year, CBO estimated a modest increase as the Trump Administration and state governments gear up for healthcare policy changes. There will only be about 1.3 million more uninsured people in 2025, CBO reported.

However, the uninsured rate will ramp up by 2026, with CBO projecting 5.2 million additional uninsured people. CBO also estimated another 6.8 million uninsured people by 2027. These two years mark a phase of significant acceleration, as shown by the most dramatic year-over-year increases in the uninsured population over the next decade.

From 2028 to 2029, CBO predicted continued growth in uninsured numbers. It is estimated that 8.6 million additional uninsured individuals will be in 2028, and 9.2 million additional uninsured individuals will be in 2029.

Finally, the growth in uninsured individuals will plateau during the last four years, with significantly smaller gains in uninsured numbers. CBO reported that from 2030 through 2034, 0.5 million more people will become uninsured under the law.

The most significant ramp-up from 2025 to 2029 aligns with the implementation of Medicaid work requirements, which is estimated to contribute to 2.2 million newly uninsured people in its first year alone.

The spending law will have a major impact on the uninsured rate in the U.S., as policy changes go into effect over the next ten years. Millions will lose coverage in public health insurance programs, in addition to restricted access to subsidized healthcare. However, the Trump Administration intends for these losses to be offset by gains from reduced Medicaid spending, stronger eligibility verifications and fewer instances of fraud, waste and abuse.

Jacqueline LaPointe is a graduate of Brandeis University and King's College London. She has been writing about healthcare finance and revenue cycle management since 2016.