Impact of Senate Reconciliation Bill that is Now with the House

July 2, 2025

Governor Hochul’s team, along with NYS health officials, presented an important briefing for nonprofit leaders on the Republican spending package and what it means for health coverage and social services in New York State.  See the summary below from our consultants at Reid, McNally & Savage (RM&S).  At the end of the summary is a document that includes the slides as well.

 

RM&S Summary of 7/2/25 Federal Reconciliation Bill – Health Briefing

Provided by the Office of Governor Hochul and the NYS Department of Health

 Today Reid, McNally & Savage participated in a briefing provided by Governor Hochul’s office and the Department of Health regarding the pending federal spending package and what it means for health coverage and social services in New York State. Please find a summary of the briefing below.

Amey Sutkowski, Federal Affairs, Office of Governor Kathy Hochul

Amey Sutkowski provided introductory remarks, noting progression of the Republican Budget Reconciliation Bill advancing in Congress. The House passed their initial version of the Bill in May, with the Senate narrowly passing their own version of the Bill yesterday, which now returns to the House for a vote. At a glance, the version of the Bill passed by the Senate is expected to impose $1.2 trillion in federal cuts. The House plans to vote today in advance of their self-imposed deadline of July 4, 2025.

Danielle Holahan, Executive Director, New York State of Health

  • New York State of Health is anticipating significant cuts to healthcare programs in NY. Current conservative estimates of 1.5 million New Yorkers who will be newly uninsured as a result of these cuts and a $13.5 billion total fiscal impact to New York.
  • The healthcare provisions of the Congressional Budget Reconciliation Bill will severely jeopardize the Essential Plan and New York’s healthcare system. The Bill eliminates premium tax credit eligibility for almost half of current enrollees and cuts more than 50% of the program’s funding with $10 billion in annual losses for New York’s healthcare economy.
  • The number of uninsured New Yorkers is expected to increase as a result of these changes, increasing the amount of uncompensated care.
  • Hospital losses are expected to exceed $1.3 billion annually and over 730,000 individuals will lose federally funded Essential Plan coverage. About 506,000 of those individuals will move to Medicaid and the remainder, about 224,000, will lose their coverage.
  • The Bill also limits coverage availability for lawfully present immigrant population (green card holders), who will no longer be eligible for subsidies they were previously eligible for.

Amir Bassiri, Medicaid Director, New York State Department of Health

  • Amir Bassiri highlighted significant impacts to Medicaid and Child Health Plus (CHP), detailing eligibility changes, work requirements, and anticipated coverage losses.
  • Groups previously eligible (refugees, asylees, parolees, etc.) will lose eligibility, with an almost immediate effective date once the bill is signed.
  • Retroactive coverage period for ACA expansion is changing. This has always been 90 days for all coverage types and will now be a two-month timeframe for CHP, and one month for Medicaid.
  • Establishment of mandatory community engagement requirements will have a significant and exponential impact on coverage loss for existing members. NYS projects between 600,000 and 1.1 million people would lose eligibility to Medicaid as a result of these requirements which are required to take effect by 2028.
  • New York State is inquiring with other states that operate work requirements within their Medicaid programs to understand implementation of these more cumbersome requirements.
  • Hospitals, Community Health Centers, physicians and other providers will experience losses in revenue as populations lose coverage, putting essential Medicaid providers out of business, resulting in job losses and local economic impacts.
  • In aggregate, additional Medicaid costs are estimated at $3 billion – $5 billion annually, amounts which do not yet include costs associated with uncompensated care. These estimates include costs associated with new requirements for DACA Recipients, implementation of new work requirements which is a huge administrative burden, and the lost state share of the MCO Tax, as DOH is anticipating only one year of revenue, rather than the previously planned two years of revenue from the MCO Tax.
  • By 2029, NYS estimates between 1 million and 1.5 million individuals will lose health insurance as a result of this legislation. As much as 15% of the entire Medicaid program will lose their coverage.

 Sonia Sekhar, Deputy Director, New York State of Health

  • New York State of Health is working to disseminate information to consumers including high-level consumer information/guidance for renewing health insurance and how certain individuals may be impacted in the new enrollment year.
  • Unlike previous auto-enrollments, enrollees will now be required to take action to ensure continued coverage. The open enrollment period is being shortened. This will require more communication with enrollees to ensure coverage continuation.

Q&A

  • How will the state absorb these additional costs? A: The Governor’s office responded that no state can backfill these unprecedented cuts. The State Budget that just passed is being stripped of about 15% of federal funding which will require a renegotiation.
  • Is there more information about who is required to fulfill new work requirements? A: Amir Bassiri noted that DOH will provide more information on work requirement eligibility once legislation is enacted.
  • What are some of the earliest changes we can expect will be implemented? A: The DACA population change is required to be made 60 days after implementation of the final rule. Verification requirements are also fairly immediate. The Essential Plan Change impacting 500,000 individuals must be made by January 2026.
  • Is there any possibility of Medicare backfilling any of these cuts? A: No.
  • How will these changes impact specific service lines (SUD treatment, maternal health, etc)? A: Decisions will have to be made about whether specific programs can continue. If this language is enacted, changes will be necessary, although decisions have not been made yet.
  • Impacts to current 1115 waiver? A: None of the cuts in the proposed bill directly impact the 1115 waiver and those funds are secured for the duration of that waiver period.

 The Governor’s office closed by urging community members to continue contacting members of the New York Congressional delegation who are supporting the Reconciliation Bill.

Slides are included in the attached PDF.