The 2025 tax and spending law narrowed Medicaid eligibility, with new rules that took effect on Oct. 1, 2025. State data compiled by the Kaiser Family Foundation show more than 281,000 lawfully present immigrants in nine states and D.C. were expected to lose Medicaid coverage. Federal estimates project up to 1 million lawfully present immigrants could lose ACA premium subsidies by 2034, and some Medicare terminations may begin Feb. 1, 2027.
New Federal Rule Could Remove Medicaid From Hundreds of Thousands of Lawful Immigrants
Hundreds of thousands of immigrants who live in the United States legally may begin losing Medicaid coverage after new federal eligibility limits tied to the 2025 tax and spending law took effect on Oct. 1, 2025.
Who Is Affected?
State reports compiled by the Kaiser Family Foundation showed that more than 281,000 lawfully present immigrants across nine states and Washington, D.C., were expected to lose Medicaid coverage in October. Those affected include some refugees, people granted asylum, survivors of human trafficking and Afghan interpreters who worked with U.S. forces.
What Changed?
The changes stem from the Republican-backed One Big Beautiful Bill Act, signed into law in July 2025. According to the Center for Medicare Advocacy, Medicaid eligibility is now generally limited to U.S. citizens and specified categories of noncitizens, such as lawful permanent residents (green card holders) and certain Cuban and Haitian entrants.
Background And Broader Impact
Immigrants living in the country without legal status were already typically ineligible for federally funded Medicaid except for qualifying emergency services. Some states have used their own funds to provide broader coverage to undocumented residents; federal guidance and investigations by the Centers for Medicare & Medicaid Services (CMS) have scrutinized these state programs.
The Congressional Budget Office projects that roughly 1 million lawfully present immigrants could lose eligibility for Affordable Care Act premium subsidies by 2034, and about 100,000 could lose Medicare coverage. The Center for Medicare Advocacy has warned that some Medicare terminations may begin on Feb. 1, 2027.
What To Watch For
States, advocacy groups and health providers are monitoring implementation and appeals. Affected individuals should receive notices from Medicaid agencies explaining next steps and whether alternative coverage or state-funded programs may be available. Legal and policy challenges could change how these rules are applied in some states.
Sources: Kaiser Family Foundation, Congressional Budget Office, Center for Medicare Advocacy, Centers for Medicare & Medicaid Services.
Help us improve.
