New peer-reviewed study reveals severe health and economic consequences of 2025 Medicaid policy changes

(Press-News.org) Waymark, a public benefit company dedicated to improving access and quality of care in Medicaid, today published peer-reviewed research in JAMA Health Forum examining the projected health system and economic impacts of 2025 Medicaid policy changes. The study, conducted in collaboration with researchers at the University of North Carolina at Chapel Hill, reveals that H.R. 1, the "One Big Beautiful Bill Act" recently passed by Congress, could result in devastating consequences for vulnerable populations, rural communities, and local economies nationwide.

Numerous studies from multiple organizations, including the nonpartisan Congressional Budget Office (CBO), estimate that Medicaid changes including eligibility restrictions, work requirements, and reduced federal matching rates would result in between 7.6 million and 14.4 million Americans becoming uninsured by 2034. Unlike previous analyses focused on enrollment projections, this study quantifies how changes in federal spending and coverage could impact population-level health outcomes and create economic ripple effects for communities across the country — particularly in rural areas already struggling with healthcare access. 

Key findings: 

The study projects that for every 100,000 people who lose Medicaid coverage, communities can expect substantial consequences for health outcomes and economic stability:

Health and Economic Impacts (Per 100,000 People Losing Coverage):

13-14 excess deaths annually

810-924 preventable hospitalizations annually

~2,582 jobs lost annually

~$1.2 billion in reduced economic output annually

Healthcare System Impacts (National Scale):

Rural hospitals face heightened risk of closure, with impact disproportionate to coverage losses due to the high concentration of patients on Medicaid in rural areas

Federally qualified health centers (FQHCs) experience revenue reductions of 18.7-26.1% depending on coverage loss magnitude and the degree to which patients losing Medicaid would be able to gain other forms of insurance (e.g., Exchange plans)

The study analyzed both base case and higher coverage loss scenarios, with per-capita health and economic consequences remaining consistent across both scenarios. These projected ratios can be applied regardless of the final number of people affected by the policy changes, as uncertainty remains regarding the scale of coverage losses due to administrative burdens of renewal and work requirement verification processes. The study is based on a comprehensive microsimulation model incorporating empirically derived parameters from peer-reviewed literature on health outcomes, healthcare systems, and local economies.

"This analysis demonstrates that Medicaid policy changes in H.R. 1 could have far-reaching consequences extending well beyond federal budget considerations," said Dr. Sanjay Basu MD PhD, lead author of the study and Co-Founder and Head of Clinical for Waymark. "The data shows that rural and underserved communities would bear a disproportionate burden of these policy changes, with implications for people’s lives and livelihoods that state and local policymakers must carefully consider."

With H.R. 1 now signed into law, these findings provide critical insights into what communities can expect as the legislation's provisions take effect. The law includes 80-hour monthly work requirements for able-bodied adults, enhanced eligibility verification every six months, and reduced federal matching rates for expansion populations—representing the most significant restructuring of Medicaid since the program's creation.

“Medicaid affects many different aspects of people’s lives,” said Dr. Seth A. Berkowitz MD MPH, co-author of the study and Associate Professor of Medicine at the University of North Carolina School of Medicine. “When Medicaid gets cut, there are of course health impacts to the people who lose coverage. But there are also important impacts to the broader community, and policymakers need to consider those impacts as well.”

Recognizing the importance of tracking implementation impacts, the research team has made their microsimulation model open source to enable updated estimates as implementation details are finalized. This approach ensures that policymakers and stakeholders have access to the most current projections as states develop their implementation plans.

"This research demonstrates the critical importance of understanding the full consequences of proposed Medicaid changes beyond federal budget numbers,” said Dr. Sadiq Y. Patel MSW PhD, an author for the study and VP of Data Science and Artificial Intelligence for Waymark. “Our model reveals that coverage losses would cascade through communities in ways that profoundly impact public health, healthcare delivery systems, and local economies. These findings should inform policymakers about the real-world trade-offs inherent in these policy decisions."

The research letter titled "Projected Health System and Economic Impacts of 2025 Medicaid Policy Proposals" was published in JAMA Health Forum. The study was conducted by Dr. Sanjay Basu (Waymark, University of California San Francisco), Dr. Sadiq Y. Patel (Waymark, University of Pennsylvania), and Dr. Seth A. Berkowitz (University of North Carolina at Chapel Hill). 
 

About Waymark

Waymark is a public benefit company dedicated to improving access and quality of care for people receiving Medicaid. We partner with health plans and primary care providers—including health systems, community health centers, and independent practices—to improve outcomes through community-based care. Our local teams of community health workers, pharmacists, therapists and care coordinators use proprietary data science and machine learning technologies to deliver evidence-based interventions to hard-to-reach patient populations. Waymark's peer-reviewed research has been published in leading journals including the New England Journal of Medicine (NEJM) Catalyst, Nature Scientific Reports, and Journal of the American Medical Association (JAMA)—demonstrating measurable improvements in health outcomes and cost savings for Medicaid populations. For more information, visit www.waymarkcare.com.

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