How States Might Respond to the One Big Beautiful Bill Act
With the One Big Beautiful Bill Act (OBBBA) still in the hands of the Senate, much of the national conversation has centered on what this legislation would do to federal coverage programs. But regardless of how the federal process unfolds, the next chapter may be written at the state level.
So, how might states respond, particularly if major provisions around Medicaid and Affordable Care Act enrollment are signed into law? The short answer: it depends (and it’s complicated). But a few pathways are beginning to emerge.
Doubling Down on Work Requirements
Some states may lean into OBBBA’s provisions and push further. Iowa recently enacted a law requiring Medicaid recipients to meet an 80-hour monthly work requirement, which will move forward pending federal approval.1 Meanwhile, Georgia’s “Pathways to Coverage” program, launched in 2023, has been closely watched as a test case. The program ties Medicaid eligibility to employment or job training but has struggled with low uptake.
Only 3,500 enrollees signed up in its first year, compared to state projections of 100,000.2 That disconnect raises a key question: if states take on more administrative complexity, will they see enrollment gains or just higher overhead?
Requesting More Waiver Flexibility
For states that want to tailor their approach, Section 1115 waivers remain the go-to option. These waivers give states room to experiment with benefit design, eligibility, and care models. But they aren’t always easy to execute. KFF’s analysis of prior waiver efforts showed delays, litigation, and uneven results.3 States hoping for a clean workaround may find the process slower and less flexible than anticipated.
Plugging Gaps with State Dollars
Some states may choose to shore up coverage on their own. New York, for example, is already bracing for the fiscal fallout. Lawmakers there estimate that maintaining current Medicaid services without added federal funds could cost the state $13.5 billion over the next few years.4 But not every state has New York’s budget, and even those that do may face tough tradeoffs between health coverage and other priorities.
Reducing Coverage, Streamlining Eligibility
Others may take a different path: scaling back. If federal dollars shrink, some states might respond by narrowing eligibility, limiting benefits, or increasing cost-sharing. While politically risky, these levers have precedent, plus they don’t require federal approval to execute. The end result, however, would likely be more variation in access from one ZIP code to the next.
Improving the System from Within
States will also need to confront the administrative side of OBBBA’s changes. More frequent eligibility checks and new documentation rules mean more friction for enrollees—and more work for state systems. Investing in technology, automation, and outreach may help buffer the impact, but those improvements won’t happen overnight.
Leaning on Community Partnerships
Finally, community-based organizations will likely play a bigger role in enrollment and navigation. Nonprofits, faith groups, and health centers have already stepped in during Medicaid redeterminations. That groundwork may prove critical again if OBBBA’s ACA changes go live.
Final Thoughts
So, what does all this mean? In short, a lot more will fall to the states and outcomes will vary depending on political will, budget capacity, and administrative readiness. Some states may push forward with new requirements. Others may resist. And many will land somewhere in between.
What’s clear is that state-level strategy will be key to shaping the real-world impact of the bill. The federal scaffolding may shift, but states will be the ones deciding how many doors stay open—and how many quietly close.
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References
1. Leys T. Work requirements for Iowa Medicaid recipients signed into law. The Gazette. May 22, 2025. Accessed June 4, 2025. https://www.thegazette.com/state-government/work-requirements-for-iowa-medicaid-recipients-signed-into-law
2. Roubein R. Georgia’s Medicaid work requirement off to a slow start. The Washington Post. May 16, 2025. Accessed June 4, 2025. https://www.washingtonpost.com/health/2025/05/16/medicaid-work-trump-cuts
3. Musumeci M, Rudowitz R. Implementing work Requirements on a national scale: What We Know from State Waiver Experience. KFF. May 2025. Accessed June 4, 2025. https://www.kff.org/policy-watch/implementing-work-requirements-on-a-national-scale
4. McKinley J. New York lawmakers warn of $13.5B impact from federal Medicaid cuts. Times Union. May 28, 2025. Accessed June 4, 2025. https://www.timesunion.com/state/article/new-york-lawmakers-warning-impact-medicaid-cuts-20367865.php
