President Donald Trump’s domestic policy agenda — a reconciliation bill called the One Big, Beautiful Bill Act — narrowly passed the U.S. House last month. It’s now in the Senate. The bill has major spending and tax cuts that could significantly reduce the number of Iowans on Medicaid. Here’s what’s happening:
What is the One Big, Beautiful Bill Act and what is it proposing for Medicaid?
The One Big, Beautiful Bill Act’s main purpose is to extend Trump’s 2017 tax cuts. The mega bill proposes about $3.75 trillion in tax cuts, according to an analysis by the nonpartisan Congressional Budget Office (CBO). But it includes many other items from increasing spending on the military and border security to eliminating taxes on tips.
In order to offset these federal tax cuts, the bill proposes significant reductions in federal spending. The CBO estimated it would save about $1.3 trillion in spending, but it would also overall add $2.4 trillion to the national deficit.
A lot of these cuts come from reducing spending on Medicaid, the jointly run federal and state government health coverage program for low-income and disabled people. Under the legislation, spending on Medicaid would be reduced by $793 billion over the next 10 years.
The bill also proposes nearly $300 billion in cuts to the Supplemental Nutrition Assistance Program, known as SNAP.
How could this affect Iowans on Medicaid?
The CBO estimates the Medicaid changes in the bill passed by the House would increase the number of uninsured Americans by 7.8 million.
For example, people could lose coverage by failing to be able to meet new Medicaid work requirements or by having their state discontinue its Medicaid expansion program due to the reduction in federal funding.
According to the Iowa Department of Health and Human Services (HHS), about 700,000 Iowans are on Medicaid — or about one in five people. This includes people on Medicaid expansion and Hawki, the Medicaid program for children. KFF estimates found Medicaid enrollment in Iowa could drop by about 90,000 by 2034.
The CBO estimates the bill overall would leave about 10.9 million Americans without health insurance, which includes the Medicaid provisions, as well as changes to the Affordable Care Act Marketplace and some state programs that cover insurance for immigrants without legal status. According to KFF, the bill would increase the number of Iowans who are uninsured by about 69,000 by 2034.
Does the bill propose changes to Medicaid work requirements?
One of the things the current reconciliation bill would do is require that people on Medicaid ages 19 to 64 who are not disabled or have dependents to work at least 80 hours a month. The requirement would start in 2026.
At the same time, Gov. Kim Reynolds signed a bill into law last week that would require similar work requirements for Iowans who are on the state’s Medicaid expansion program, which is primarily for low-income individuals who are not disabled.
Reynolds also announced in April that she has separately directed the Iowa HHS to submit a waiver to the federal Centers for Medicaid and Medicare Services so the state can establish Medicaid work requirements. If that waiver is approved, Iowa's Medicaid work requirements would go into effect July 1, according to the law.
A spokesperson for Iowa HHS told IPR that the department is still working on drafting that waiver.
If Congress also passes Medicaid work requirements, it’s still unclear how that will affect Iowa’s new law.
What have Iowa’s lawmakers said about this bill?
Iowa’s Sens. Joni Ernst and Chuck Grassley, who are both Republicans, have indicated they will support the bill when it comes up for a vote in the Senate.
Ernst defended the bill’s cuts to Medicaid at a town hall May 30.
“What we do need to do is make sure that those that are part of a vulnerable population have access to Medicaid and receive those full benefits,” she said. “So what we're trying to do is strengthen Medicaid by directing the dollars to the people that actually meet the requirements of the program.”
Grassley said in a June 3 call with reporters that the Senate was working on the bill and its goal is “obviously to pass the legislation by the July 4 recess,” saying it was “important and critical” to prevent a tax hike.
Iowa’s four U.S. representatives, who are all Republicans, each voted for it on May 22.
Rep. Ashley Hinson, who represents Iowa’s 2nd Congressional District, has said recently that the bill’s Medicaid work requirements target abled-bodied adults.
“If you’re a 29-year-old man choosing not to work, sitting on the couch in your mom’s basement, then you’re going to have to have a conversation about getting a job if you want to continue to take a government benefit. So, I think it was really important to be able to get out there and answer those kinds of questions,” Hinson said during a press call on May 29.
Rep. Zach Nunn, who represents Iowa’s 3rd Congressional District, wrote on social media platform X May 22 after the House passed the bill that it “protects benefits for the vulnerable” and “cuts waste and fraud.”
Republican Gov. Kim Reynolds also expressed her support for the bill’s cuts to Medicaid in a June 6 editorial for the Washington Examiner.
“What it does is protect the program from being overwhelmed by fraud, abuse and unchecked expansion to people who were never meant to be covered. If we want Medicaid to survive, we must return it to its original mission: serving the truly vulnerable,” she said.
What concerns about the changes to Medicaid have been raised?
Democrats and opponents say spending cuts and work requirements won’t curb waste and fraud in the program. Instead, it will create more red rape, causing people who should qualify for the program to lose coverage while supporting tax cuts for wealthier Americans.
“It really is kind of death by paperwork. I mean, they're getting a lot of these cuts through weird financing rules and putting up as many administrative burdens as possible,” said Anne Discher, the executive director of Common Good Iowa, which advocates for families and children.
A CBO estimate from 2023 found Medicaid work requirements would lead to lower federal costs, a rise in state costs, an increase in the number of uninsured people and no change in the number of hours Medicaid recipients work.
“For the most part, it's not the work that becomes the barrier to coverage, it's the reporting that becomes the barrier to coverage,” Discher said.
Akeiisa Coleman, a senior program officer with the Commonwealth Fund, said its analyses show that a higher number of uninsured people could be financially devastating for rural and safety net hospitals, which already operate on tight margins.
“If you lose those revenues, those hospitals that are operating on the margins, they are just barely able to balance their books. They're going to have to close their doors,” she said.
Dave Muhlbauer, a Democrat and Crawford County supervisor who serves on the board of his local hospital, told IPR the spending cuts could put the hospital in a dire financial situation.
“We could be looking at cutting services. We could be looking at a lot of different things to stay afloat. But that just really pushes people to have to travel farther,” he said.
Rep. Hinson and Sen. Ernst have endured questioning and booing from some constituents at recent town hall meetings while defending the bill.
State Sen. Sarah Trone Garriott, a Democrat from West Des Moines who recently launched a bid for Rep. Nunn’s congressional seat, said last week that “indiscriminate cuts” are not about addressing fraud in Medicaid.
“It's already very stringent, very challenging, to get on Medicaid. There's a lot of people who should be on it who are not being served. So, it's actually the opposite problem we have, is more people could be eligible, but the process is so challenging that they can’t get on and stay on Medicaid,” she said.
What’s next for the One Big, Beautiful Bill Act?
The bill is in the Senate, which is already making changes to it. The Senate’s version of the bill needs to pass with a simple majority of 51 votes and then goes back to the House for approval again for the Senate’s changes before it can go to President Trump’s desk.
The bill is part of a special expedited budget reconciliation process that helps advance high priority bills faster, meaning it cannot be filibustered and is limited in the number of amendments it can have.
Trump has urged the Senate to get the bill to his desk by July 4, well before his 2017 tax cuts expire. Megan Goldberg, an associate professor of American politics at Cornell College, said it will be challenging to make that goal, as some lawmakers have voiced concerns about the House version’s impact on the national deficit.
“I think that part of Trump's push for July 4 is perhaps an instinct that the longer this drags on, the harder it is to keep everyone together,” Goldberg said. “But members of the Senate don't have the same incentives to move that fast. Their incentive is to get reelected, and that does not align necessarily."
Republicans hold a slim majority in the Senate, with 53 seats, so they don’t need any support from Democrats. But they also don’t have many votes to spare.
Goldberg said ultimately she expects the bill will pass, but when and what the final version will look like are still very much up in the air.
IPR reporters James Kelley and Katarina Sostaric contributed to this report.
