Nearly 140K Could Lose Healthcare Coverage Due to Federal Budget Bill

July 31, 2025

Nearly 140,000 Minnesotans will lose their healthcare coverage as a result of President Trump’s budget reconciliation bill, according to a preliminary analysis by the Minnesota Department of Human Services (DHS).  

“The impacts on Medical Assistance, Minnesota’s Medicaid program, will be significant and felt by all Minnesotans,” the DHS said in a release. “The bill specifically targets low-income adults without children, saddling them with additional paperwork, forcing more frequent administrative hoops, and imposing medical bills.”  

DHS will continue analyzing the effects of the bill, but reports that it will have significant impact on the following: 

• Because of new work reporting requirements, it's anticipated that the state will see $200 million in reduced federal funding annually from loss of coverage, as well as potential annual increases of $165 million each year in state, county and Tribal administrative costs. 

• The bill increases eligibility checks for low-income adults without children from every 12 months to every six months. DHS estimates it will cost Minnesota taxpayers $4.9 million annually for increased administrative costs. 

• States must impose cost sharing on adults without children with incomes between 100% and 138% of the federal poverty level. DHS estimates that there will be $4 million in increased out-of-pocket costs for enrollees. 

• The legislation restricts people with specific lawful immigration statuses from Medicaid coverage, including refugees; people granted withholding under the Convention Against Torture; and victims of trafficking. At this point, DHS has not determined the financial impact on those affected by this law. But, DHS does estimate the impact for changes to emergency Medicaid services at $13.6 million per year in losses of federal funding. 

“The impact of this bill will be significant on the health of thousands of Minnesotans,” said MMA President Edwin Bogonko, MD, MBA. “The MMA is committed to educating our members as the bill is implemented. We will collaborate with our Minnesota partners to mitigate the bill’s anticipated harms, and advocate for corrective policy at every possible opportunity.”    

Find additional information on the bill, click here.