July 11, 2025
I sent the following message (see below in italics) to all members last night after having sent an earlier email on the same topic at about 3:45 pm (yesterday).
I am aware there are different analyses floating around and I believe this is the general intent of the HHS documents released yesterday – that is, to confuse and frighten vulnerable Americans; however, I spoke to our attorney at Feldesman this morning and then again this afternoon and the firm is solid in its clarification (italics below) regarding the information that came out of HHS. The FINAL Rule is expected to be published in the Federal Register on Monday and if so, this would be the effective date of the new Rule. (The Rule we shared yesterday was open to public comment so the final Final Rule is expected shortly.)
Feldesman will continue to update us and we will make you aware of any changes to the information we have sent you to this point.
- The official Notice from HHS is likely to be published in the Federal Register on Monday (and it will be effective immediately on that day)
- Protections for nonprofits
- 8 U.S.C. 1642(d) – “(d) No verification requirement for nonprofit charitable organizations Subject to subsection (a), a nonprofit charitable organization, in providing any Federal public benefit (as defined in section 1611(c) of this title) or any State or local public benefit (as defined in section 1621(c) of this title), is not required under this chapter to determine, verify, or otherwise require proof of eligibility of any applicant for such benefits.” https://codes.findlaw.com/us/title-8-aliens-and-nationality/8-usc-sect-1642/
- This means we cannot be responsible for verifying immigration status ourselves.
Please do not forward NYS Council emails / analysis / information to non-members, consultants, other associations, etc. Thank you.
(THURSDAY EVENING, 7/10)
Good evening,
Lawyers at Feldesman, LLP have been reviewing the proposed HHS rule that dropped earlier today (please see our email from today at 3:46 pm) and they have discovered that the HHS announcement (embedded in that email) does not acknowledge that the PRWORA statute includes an exception to the requirement to conduct program eligibility verification for “nonprofit charitable organization[s]”. In other words, under PRWORA a nonprofit cannot be required to “determine, verify, or otherwise require proof of eligibility of any applicant for benefits.” Rather, another entity, such as a state agency, would conduct the verification and provide the results to the nonprofit to use to determine eligibility for benefits and services. Without such a requirement, nonprofits are not required under PRWORA to verify the immigration status of clients before providing services.
We will continue to update you as needed.
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Here’s the first article I’ve seen on the issue of the Federal Public Benefit Rule:
(Fierce Healthcare, 7/11)
The Department of Health and Human Services has rescinded a policy from 1998 that gave undocumented immigrants access to certain federal health benefits, such as Head Start and mental health programs.
Issued by President Bill Clinton, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 was passed into law and deemed a major welfare reform.
Among its provisions, the bill attempted to uniformly restrict eligibility of benefits for noncitizens, including green card holders and refugees, according to a Congressional Review Service report. This means noncitizens are not eligible for non-emergency Medicaid, the SNAP program, Affordable Care Act subsidies and other programs. They are also banned from many state and local benefits.
However, noncitizens can receive emergency Medicaid care, immunizations, disaster relief, certain housing and nutrition programs. Benefits can also be extended to immigrants through state or local funds, as has been accomplished in California, New York and Illinois.
Thursday, the HHS pulled back an interpretation of the bill they said sidestepped the law by giving too much access to federal benefits.
“For too long, the government has diverted hardworking Americans’ tax dollars to incentivize illegal immigration,” said HHS Secretary Robert F. Kennedy Jr. in a news release. “Today’s action changes that—it restores integrity to federal social programs, enforces the rule of law, and protects vital resources for the American people.”
The administration’s new policy reverses “outdated exclusions,” and stresses that people are subject to eligibility restrictions. It also states that no programs are exempt from the bill’s list of exceptions.
Mental health and community services block grants, the Head Start program, the Title X Family Planning Program and three Title IV programs are now deemed federal benefits. As are community behavioral health clinics, certain workforce and homelessness programs, and substance use abuse programs and grants.
The HHS expects reclassifying Head Start will bring in $374 million annually, the agency announced.
Groups representing community health centers (CHCs) reacted to the regulatory shift, some uncertain how to best comply with federal law now.
“Federal law requires CHCs to accept ‘all residents of the area served by the center,’ the National Association of Community Health Centers said in a statement, noting they are consulting with policy and legal experts on how to best move forward.
“The policy announced today will drive people away from health care, make people and communities sicker, and strain costlier parts of the health care system,” said Advocates for Community Health, another organization representing CHCs, in a statement.
In April, the American Civil Liberties Union and major reproductive groups sued the HHS for withholding more than $65 million in Title X federal family planning grants through frozen funding. These programs give access to contraceptive methods and preventive services.
“For more than 50 years, Title X has provided high-quality, confidential, and affordable sexual and reproductive health care to all, regardless of who they are or where they come from,” said Clare Coleman, president and CEO of the National Family Planning & Reproductive Health Association, in a statement Thursday. “HHS’s policy change would upend longstanding Public Health Service Act interpretation, threaten public health, and foster discrimination against immigrant communities and others who can’t prove citizenship.”
Under Kennedy’s leadership, the HHS is also undergoing a massive restructuring and consolidation of offices, leaving advocacy groups concerned about the future of substance use abuse, mental health and disease treatment support from the federal government.
The Trump administration broadly has used sensitive healthcare data to clamp down on illegal immigration, drawing more pushback from privacy experts and health plans. Twenty states are now suing over Medicaid data sharing with other federal agencies. Interest in restricting health benefits to noncitizens and funding deportation efforts was combined in passing Trump’s signature budget bill last week.————————
RECORDING OF YESTERDAY’S FISCAL POLICY INSTITUTE (FPI) WEBINAR IS LINKED BELOW FOR THOSE WHO MISSED IT.
Note: Fiscal Policy Institute is hosting a second webinar to follow up on the information provided during the event yesterday) on July 17 at noon. I haven’t received registration info or a formal announcement yet but I urge you to mark your calendars!
| New York Will Lose $23 Billion Per Year Under The “One Big Beautiful Bill Act” 1.5 million New Yorkers will lose their health insurance |
| July 11, 2025Last Friday, July 4, 2925, President Trump signed a sprawling piece of legislation —referred to as the “One Big Beautiful Bill Act” (“OBBBA”) — that enacts one of the most regressive set of tax and spending cuts seen in United States history. In addition to redistributing towards the wealthy and cutting programs that support the health and wellbeing of low- and middle-income families, the bill adds significantly to the federal debt and reverses important progress that has been made towards stemming climate change. The OBBBA reduces tax revenue by $4.5 trillion over the next 10 years and cuts spending by $1.5 trillion. Combined with added spending on programs like the ramping up of the budget for Immigration and Customs Enforcement (ICE), the OBBBA adds $3.3 trillion to the federal deficit over the next 10 years. The OBBBA spending cuts are concentrated in Medicaid and food stamps (SNAP), with devastating effects for New Yorkers. The bill will cut federal funding to the New York State budget by approximately $10 billion annually and kick 1.5 million New Yorkers off their health insurance, more than doubling the statewide uninsured population. On top of the direct fiscal costs to New York State, the OBBBA will cut an additional $13 billion in funding to New York’s healthcare system. Cuts to healthcare funding will hit New York’s many financially distressed hospitals, forcing closures across the state. FPI previously estimated that cuts to healthcare spending will eliminate 215,000 jobs statewide, raising the unemployment rate by 50 percent. The OBBBA will also reduce federal funding for food stamps (SNAP) – a program that keeps 3 million low-income New Yorkers from going hungry – but it requires state governments to fill in these spending gaps, which would cost New York State up to $1.4 billion annually. Ultimately, New York’s elected leaders will be forced to make hard choices between new tax measures to fund these obligations and spending cuts to the State’s most important safety-net programs. To protect New Yorkers from the draconian cuts coming from Washington, New York lawmakers must convene a special session and establish new revenue measures to pay for funding gaps. ————————————– |
FYI for Budget Wonks
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The Senate will vote next week on whether to claw back $9.4 billion in federal funding that Congress previously approved, a process known as “rescissions.” Unlike most bills, rescissions packages need just 51 Senate votes to pass—yes, another fast-track Senate process that begins with “re-” to learn, just a week post-reconciliation! I’ll break this one down as simply as I can below. What is the “rescissions” process? Every year, Congress must craft government funding (“appropriations”) bills that provide resources for federal agencies to do their work and keep the government open. These bills require 60 Senate votes to pass—which, in recent years, has meant that they must be bipartisan, as no party has held a 60+ Senate majority in some time. Like any bill, the President must sign government funding legislation into law. The rescissions process provides a pathway for a President to rescind some of that already-approved funding. How does the rescissions process work? I’ll make up an example to illustrate this at a high level. Say Congress reached a bipartisan funding agreement to give Agency A $10 million to build Cat’s Dream House. The President signs that agreement into law, but then decides he doesn’t want Cat to have her dream house. The President must alert Congress that he wants to rescind that $10 million for Cat’s Dream House from Agency A. Congress then has 45 days to approve that rescission, during which the administration can hold back (i.e., not spend) that $10 million. Again, the Senate just needs a simple majority vote to approve the rescission. Congress may approve the whole rescission request or parts of it—e.g., they could say they’ll only claw back $6 million of the $10 million the President asked to rescind, leaving $4 million for Cat’s Dream House. Congress could also reject the rescissions package; this happened during the first Trump administration. If Congress fails to act within the 45-day window, the administration is obligated to spend the funding, meaning Cat’s Dream House is a go. What funding does the Trump administration want to rescind? The $9.4 billion rescissions request includes the following funds:$3.7 billion for the now-dismantled U.S. Agency for International Development (USAID)$4.7 billion for foreign assistance, including global health programs like the President’s Emergency Plan for AIDS Relief (PEPFAR) and contributions to United Nations bodies like UNICEF$1.07 billion for the Corporation for Public Broadcasting, which funds PBS and NPR What effects could these rescissions have? Clawing back funding for public broadcasting could shut down public radio and TV stations, threatening life-saving emergency broadcasts that rural communities in particular depend on during disasters, such as the recent flash floods in Texas. Public broadcasting alerts have been critical when cell and Internet service has gone down, such as during Hurricane Helene in North Carolina. Rescinding global health funding will similarly be life-threatening. PEPFAR alone is estimated to have saved 26 million lives. Ending the program could lead to an additional 2-4 million deaths in sub-Saharan Africa annually. Beyond the direct impacts on people who will suffer because of these cuts, the very act of rescinding money Congress approved on a bipartisan basis could jeopardize efforts to reach a government funding agreement ahead of the end of the fiscal year (September 30). To go back to my tortured metaphor: say I only agreed to vote for an appropriations bill because I secured $10 million for Agency A to build Cat’s Dream House. If the administration is going to claw back that money—and my colleagues in Congress are willing to go along with it—why would I make a deal with them again in the future? Why would I have faith that the wins I secure are, in fact, going to be secure? Indeed, the administration has said it plans to send more rescissions requests to Congress after this one—meaning, this isn’t the only pot of funding it wants to take away from communities. Is this all the federal funding the administration has refused to spend? No. The House and Senate Appropriations Committees (Democrats) estimate that the administration is currently holding back more than $425 billion from the American people. Again, Congress has already approved these resources on a bipartisan basis. This covers funding for teacher training, libraries, electric vehicle charger installations, and much more. What happens next? |
| The House approved the rescissions package on June 12. That 45-day clock to approve the package runs out on Friday, July 18. While the Senate plans to vote this week, some senators have reservations about pieces of the package—namely, the aforementioned cuts to PEPFAR and, especially, public broadcasting in the wake of the Texas flash floods. Notwithstanding the President’s threats to senators who vote to preserve that broadcasting, the Senate could amend the package to remove or pare back the proposed cuts. This would necessitate the bill going back to the House to approve the Senate-amended version right before the deadline. Sound familiar? In the event the package is rejected or Congress misses the deadline, the administration will be obligated to spend the funding. We’ll keep you posted as this process unfolds. |