One Big Beautiful Bill Act: Impacts on Medicaid and Vulnerable Populations

Changes to work and eligibility criteria granting access to Medicaid services under the One Big Beautiful Bill Act (OBBBA) could threaten unhoused individuals’ access to health coverage. The law, signed into law on July 4, 2025 (Public Law 119-21), introduces new administrative requirements and conditions for Medicaid eligibility, potentially impacting millions of Americans.

New Requirements and Potential Barriers

The OBBBA introduces work reporting requirements, set to take effect January 1, 2027, for individuals aged 19-64 seeking Medi-Cal coverage. These individuals will require to demonstrate a monthly or seasonal income at least 80 times the federal hourly minimum wage, or at least 80 hours of employment each month. Alternatives to meet these requirements include participation in community service, work programs, and educational programs, totaling 80 hours per month. The law also shortens coverage renewal periods to every six months, compared to the current annual renewal cycle.

These new requirements pose significant challenges for unhoused individuals, who already face administrative obstacles to accessing essential services. As David Gonzalez, Chair of the Board of Directors at the Berkeley Free Clinic, noted, “Existing barriers already craft it hard for unhoused individuals to access essential services.” Community organizations and healthcare professionals may be strained to meet the growing needs of this vulnerable population.

National and California Impacts

Medicaid, along with the Children’s Health Insurance Program (CHIP), serves over 77.9 million people in the United States, making it the largest source of health coverage in the country. The American Medical Association reports that the OBBBA could cause more than 5 million people across the United States to lose access to Medicaid.

California’s Medi-Cal program, which provides coverage for approximately 14.7 million people as of June 2025, is also affected. The California Policy Team highlights that the OBBBA cuts approximately $1 trillion from Medicaid, compounding existing cuts within the state budget.

Challenges with Documentation and Access to Care

The California Department of Health Care Services anticipates increased administrative workload and user issues related to maintaining documentation under the new requirements. The federal Centers for Medicare and Medicaid Services (CMS) is working with states to implement these changes, distributing $200 million in Government Efficiency Grants to streamline eligibility systems and implementing the Working Families Tax Cut legislation.

Individuals experiencing homelessness face additional hurdles in meeting these requirements, often lacking necessary identification, proof of sobriety, or a permanent address. These barriers can hinder access to employment, education, and volunteer opportunities.

Personal Stories and the Importance of Coverage

Luis Rodriguez, an unhoused individual, shared the experience of covering expenses for his elderly friend’s back surgery after Medi-Cal denied coverage, illustrating the financial strain and potential consequences of limited access to care. He expressed a sense of despair, stating, “A lot of people give up (on) life.”

Individuals like Elester Shelton II, who relies on Medi-Cal for eye drops to prevent blindness from iritis, face the prospect of significant out-of-pocket expenses if coverage is lost. He emphasized the critical role of Medi-Cal in maintaining his health, stating, “Without these eye drops that they have, I, for one, would have been blind by now.”

Looking Ahead

The implementation of the OBBBA’s changes to Medicaid presents significant challenges for vulnerable populations, particularly those experiencing homelessness. Ongoing efforts to streamline eligibility systems and provide support services will be crucial to mitigating the potential negative impacts of these new requirements. Continued monitoring and advocacy will be essential to ensure equitable access to healthcare for all.