Personal Finance
Health insurance coverage losses under House GOP tax, spending bill
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The House tax and spending bill would push millions of Americans off health insurance rolls, as Republicans cut programs like Medicaid and the Affordable Care Act to fund priorities from President Donald Trump, including almost $4 trillion of tax cuts.
The Congressional Budget Office, a nonpartisan legislative scorekeeper, projects about 11 million people would lose health coverage due to provisions in the House bill, if enacted in its current form. It estimates another 4 million or so would lose insurance due to expiring Obamacare subsidies, which the bill doesn’t extend.
The ranks of the uninsured would swell as a result of policies that would add barriers to access, raise insurance costs and deny benefits outright for some people like certain legal immigrants.
The legislation, known as the “One Big Beautiful Bill Act,” may change as Senate Republicans now consider it. Health care cuts have proven to be a thorny issue. A handful of GOP senators — enough to torpedo the bill — don’t appear to back cuts to Medicaid, for example.
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The bill would add $2.4 trillion to the national debt over a decade, CBO estimates. That’s after cutting more than $900 billion from health care programs during that time, according to the Penn Wharton Budget Model.
The cuts are a sharp shift following incremental increases in the availability of health insurance and coverage over the past 50 years, including through Medicare, Medicaid and the Affordable Care Act, according to Alice Burns, associate director with KFF’s program on Medicaid and the uninsured.
“This would be the biggest retraction in health insurance that we’ve ever experienced,” Burns said. “That’s makes it really difficult to know how people, providers, states, would react.”
Here are the major ways the bill would increase the number of uninsured.
No population ‘safe’ from proposed Medicaid cuts
Speaker of the House Mike Johnson, R-La., pictured at a press conference after the House narrowly passed a bill forwarding President Donald Trump’s agenda on May 22 in Washington, DC.
Kevin Dietsch | Getty Images
Federal funding cuts to Medicaid will have broad implications, experts say.
“No population, frankly, is safe from a bill that cuts more than $800 billion over 10 years from Medicaid, because states will have to adjust,” said Allison Orris, senior fellow and director of Medicaid policy at the Center on Budget and Policy Priorities.
The provision in the House proposal that would lead most people to lose Medicaid and therefore become uninsured would be new work requirements that would apply to states that expanded Medicaid under the Affordable Care Act, according to Orris.
The work requirements would affect eligibility for individuals ages 19 to 64 who do not have a qualifying exemption. Affected individuals would need to demonstrate they worked or participated in qualifying activities for at least 80 hours per month.
States would also need to verify that applicants meet requirements for one or more consecutive months prior to coverage, while also conducting redeterminations at least twice per year to ensure individuals who are already covered still comply with the requirements.
In a Sunday interview with NBC News’ “Meet the Press,” House Speaker Mike Johnson, R-La., said “4.8 million people will not lose their Medicaid coverage unless they choose to do so,” while arguing the work requirements are not too “cumbersome.”
The Congressional Budget Office has estimated the work requirements would prompt 5.2 million adults to lose federal Medicaid coverage. While some of those may obtain coverage elsewhere, CBO estimates the change would increase the number of people without insurance by 4.8 million.
Those estimates may be understated because they do not include everyone who qualifies but fails to properly report their work hours or submit the appropriate paperwork if they qualify for an exemption, said KFF’s Burns.
Overall, 10.3 million would lose Medicaid, which would lead to 7.8 million people losing health insurance, Burns said.
Proposal creates state Medicaid funding challenges
Protect Our Care supporters display “Hands Off Medicaid” message in front of the White House ahead of President Trump’s address to Congress on March 4 in Washington, D.C.
Paul Morigi | Getty Images Entertainment | Getty Images
While states have used health care provider taxes to generate funding for Medicaid, the House proposal would put a stop to using those levies in the future, Orris noted.
Consequently, with less revenue and federal support, states will face the tough choice of having to cut coverage or cut other parts of their state budget in order to maintain their Medicaid program, Orris said.
For example, home and community-based services could face cuts to preserve funding for mandatory benefits like inpatient and outpatient hospital care, she said.
The House proposal would also delay until 2035 two Biden-era eligibility rules that were intended to make Medicaid enrollment and renewal easier for people, especially older adults and individuals with disabilities, Burns said.
States would also have their federal matching rate for Medicaid expenditures reduced if they offer coverage to undocumented immigrants, she said.
Affordable Care Act cuts ‘wonky’ but ‘consequential’
Senate Minority Leader Chuck Schumer, D-N.Y., speaks about the health care impacts of the Republican budget and policy bill, also known as the “One Big Beautiful Bill Act,” during a June 4 news conference in Washington, D.C.
Saul Loeb | Afp | Getty Images
More than 24 million people have health insurance through the Affordable Care Act marketplaces.
They’re a “critical” source of coverage for people who don’t have access to health insurance at their jobs, including for the self-employed, low-paid workers and older individuals who don’t yet qualify for Medicare, according to researchers at the Center on Budget and Policy Priorities, a left-leaning think tank.
The House legislation would “dramatically” reduce ACA enrollment — and, therefore, the number of people with insurance — due to the combined effect of several changes rather than one big proposal, wrote Drew Altman, president and chief executive of KFF, a nonpartisan health policy group.
“Many of the changes are technical and wonky, even if they are consequential,” Altman wrote.
Expiring ACA subsidies add to coverage costs
ACA enrollment is at an all-time high. Enrollment has more than doubled since 2020, which experts largely attribute to enhanced insurance subsidies offered by Democrats in the American Rescue Plan Act in 2021 and then extended through 2025 by the Inflation Reduction Act.
Those subsidies, called “premium tax credits,” effectively reduce consumers’ monthly premiums. (The credits can be claimed at tax time, or households can opt to get them upfront via lower premiums.)
Congress also expanded the eligibility pool for subsidies to more middle-income households, and reduced the maximum annual contribution households make toward premium payments, experts said.
The enhanced subsidies lowered households’ premiums by $705 (or 44%) in 2024 — to $888 a year from $1,593, according to KFF.
The House Republican legislation doesn’t extend the enhanced subsidies, meaning they’d expire after this year.
About 4.2 million people will be uninsured in 2034 if the expanded premium tax credit expires, according to the Congressional Budget Office.
“They might just decide not to get [coverage] because they simply can’t afford to insure themselves,” said John Graves, a professor of health policy and medicine at Vanderbilt University School of Medicine.
Coverage will become more expensive for others who remain in a marketplace plan: The typical family of four with income of $65,000 will pay $2,400 more per year without the enhanced premium tax credit, CBPP estimates.
Adding red tape to eligibility, enrollment
More than 3 million people are expected to lose Affordable Care Act coverage as a result of other provisions in the House legislation, CBO projects.
Other “big” changes include broad adjustments to eligibility, said Kent Smetters, professor of business economics and public policy at the University of Pennsylvania’s Wharton School.
For example, the bill shortens the annual open enrollment period by about a month, to Dec. 15, instead of Jan. 15 in most states.
It ends automatic re-enrollment into health insurance — used by more than half of people who renewed coverage in 2025 — by requiring all enrollees to take action to continue their coverage each year, CBPP said.
Senate Majority Leader Sen. John Thune (R-SD) (C) speak alongside Sen. John Barrasso (R-WY) (L) and Sen. Mike Crapo (R-ID) (R) outside the White House on June 4, 2025. The Senators met with President Donald Trump to discuss Trump’s “One, Big, Beautiful Bill” and the issues some members within the Republican Senate have with the legislation and its cost.
Anna Moneymaker | Getty Images News | Getty Images
The bill also bars households from receiving subsidies or cost-sharing reductions until after they verify eligibility details like income, immigration status, health coverage status and place of residence, according to KFF.
Graves says adding administrative red tape to health plans is akin to driving an apple cart down a bumpy road.
“The bumpier you make the road, the more apples will fall off the cart,” he said.
Uncapping subsidy repayments
Another biggie: The bill would eliminate repayment caps for premium subsidies.
Households get federal subsidies by estimating their annual income for the year, which dictates their total premium tax credit. They must repay any excess subsidies during tax season, if their annual income was larger than their initial estimate.
Current law caps repayment for many households; but the House bill would require all premium tax credit recipients to repay the full amount of any excess, no matter their income, according to KFF.
While such a requirement sounds reasonable, it’s unreasonable and perhaps even “cruel” in practice, said KFF’s Altman.
“Income for low-income people can be volatile, and many Marketplace consumers are in hourly wage jobs, run their own businesses, or stitch together multiple jobs, which makes it challenging, if not impossible, for them to perfectly predict their income for the coming year,” he wrote.
Curtailing use by immigrants
The House bill also limits marketplace insurance eligibility for some groups of legal immigrants, experts said.
Starting Jan. 1, 2027, many lawfully present immigrants such as refugees, asylees and people with Temporary Protected Status would be ineligible for subsidized insurance on ACA exchanges, according to KFF.
Additionally, the bill would bar Deferred Action for Childhood Arrivals recipients in all states from buying insurance over ACA exchanges.
DACA recipients — a subset of the immigrant population known as “Dreamers” — are currently considered “lawfully present” for purposes of health coverage. That makes them eligible to enroll (and get subsidies and cost-sharing reductions) in 31 states plus the District of Columbia.
The Federal Reserve held interest rates steady at the conclusion of its policy meeting on Wednesday.
In what could be Jerome Powell’s last as chair before President Donald Trump’s yet-to-be-confirmed nominee Kevin Warsh takes the helm, central bankers maintained the federal funds rate in a target range of 3.5% to 3.75%.
Inflation has surged since the war with Iran began, leaving policymakers with limited room to act, according to Sean Snaith, the director of the University of Central Florida’s Institute for Economic Forecasting. “We’re in a kind of suspended animation — between Iran and the Fed transition,” Snaith said.
Before the oil shock, inflation was holding above the Fed’s 2% target but not worsening. Now the jump in energy costs could have longer-term inflationary effects, economists say.
For Americans struggling in the face of higher gas prices and overall affordability challenges, the central bank’s decision to keep interest rates unchanged does little to ease budgetary pressures. “The cavalry isn’t coming anytime soon,” Snaith said.
How the Fed decision impacts you
The Fed’s benchmark sets what banks charge each other for overnight lending, but also has a trickle-down effect on many consumer borrowing and savings rates.
Short-term rates are more closely pegged to the prime rate, which is typically 3 percentage points above the federal funds rate. Longer-term rates, such as home loans, are more influenced by inflation and other economic factors.
Credit cards
Most credit cards have a short-term rate, so they track the Fed’s benchmark.
After the Fed cut rates three times in the second half of 2025, the average annual percentage rate has stayed just under 20%, according to Bankrate.
“Without Fed rate cuts, there’s not much reason to expect meaningful declines anytime soon, so carrying a balance will remain very expensive,” said Matt Schulz, chief credit analyst at LendingTree.
Mortgage rates
Fixed mortgage rates, on the other hand, don’t directly track the Fed but typically follow the lead of long-term Treasury rates.
Concerns about how the Iran war will impact the U.S. economy have already pushed the average rate for a 30-year, fixed-rate mortgage up to 6.38% as of Tuesday, from 5.99% at the end of February, according to Mortgage News Daily.
That leaves homeowners with existing low mortgage rates “feeling stuck,” said Michele Raneri, vice president and head of U.S. research and consulting at TransUnion. “Mortgages, more than any other credit type, work on a churn,” she said, referring to how a dip in rates can boost borrowing activity.
Student loans
Federal student loan rates are also fixed and based in part on the 10-year Treasury note, so most borrowers are somewhat shielded from Fed moves and recent economic uncertainty.
Current interest rates on undergraduate federal student loans made through June 30 are 6.39%, according to the U.S. Department of Education. Interest rates for the upcoming school year will be based in part on the May auction of the 10-year note.
Car loans
Auto loan rates are tied to several factors, including the Fed’s benchmark. Because financing costs remain elevated, new car buyers are taking on longer loans to keep their monthly payments manageable, according to the latest data from Edmunds.
Even so, with the rate on a five-year new car loan near 7%, the average monthly payment on a new car rose to $773 in the first quarter of 2026, an all-time high.
“Car buyers are in a tough spot right now because they’re getting squeezed from both ends: high sticker prices and high interest rates, with neither showing any signs of letting up,” said Joseph Yoon, consumer insights analyst at Edmunds.
“Until the rate picture shifts, buyers will keep stretching loan terms to make payments work, which only adds to the total cost of ownership down the road,” Yoon said.
Savings rates
While the Fed has no direct influence on deposit rates, the yields tend to be correlated with changes in the target federal funds rate. So, although rates on certificates of deposit and high-yield savings accounts have fallen from recent highs, they are holding above the annual rate of inflation.
For now, top-yielding online savings accounts and one-year CD rates pay around 4%, according to Bankrate.
“Yields on high-yield savings accounts and certificates of deposit are down from their peaks of a few years ago, but they’re still strong compared to what we’ve seen for most of the past decade,” Schulz said.
Milan Markovic | E+ | Getty Images
The average tax refund is 11.2% higher this season, compared with about the same period in 2025, according to the latest IRS filing data.
As of April 10, the average refund amount for individual filers was $3,397, up from $3,055 about one year ago, the IRS reported on Friday.
The IRS data reflects about 114 million individual returns received, out of about 164 million expected through Tax Day. Next week’s filing update is expected to include data through the April 15 deadline.
President Donald Trump‘s 2025 legislation, rebranded to the “working families tax cuts,” was a key talking point for Republicans on Tax Day.
With the November midterm elections approaching and Republicans defending slim majorities in Congress, many GOP lawmakers have highlighted Trump’s tax breaks and higher average refunds.
Meanwhile, affordability has been top of mind for many Americans amid rising costs of gas, electricity, food and other living expenses.
For filers who expected a refund this season, nearly one-quarter, or 23%, planned to use the funds to pay down credit card debt, and the same share said they would save the payment, according to the CNBC and SurveyMonkey Quarterly Money Survey, released in April. It polled 3,494 U.S. adults at the end of March.
Who benefited from Trump’s ‘big beautiful bill’
“It’s been a great tax season for the American people,” many of whom have benefited from Trump’s tax breaks, Treasury Secretary Scott Bessent said during a White House press briefing on Wednesday.
More than 53 million filers claimed at least one of Trump’s “signature new tax cuts” — the deductions for tip income, overtime earnings, seniors and auto loan interest — the Department of the Treasury also announced on Wednesday.
Those filers, who claimed the deductions on Schedule 1-A, have seen an average tax cut of over $800, according to the Treasury. Tax cuts can trigger a higher refund or reduce taxes owed, depending on the filer’s situation.
Some filers who itemize tax breaks have also seen benefits from the bigger federal deduction limit for state and local taxes, known as SALT. Trump’s legislation raised that cap to $40,000, up from $10,000, for 2025.
The latest SALT deduction limit change is expected to primarily benefit higher earners, according to a May 2025 analysis of various proposals from the Tax Foundation.
The Treasury has not released data on how many filers have claimed the SALT deduction during the 2026 filing season.
Traders work at the New York Stock Exchange on April 16, 2026.
NYSE
U.S. stocks climbed to record highs on Thursday against a backdrop of war, an oil supply shock and economic forecasts warning of stunted growth amid a protracted conflict.
Many investors may be thinking: Why?
Largely, it’s because the stock market is a barometer of what investors think will happen in the future, rather than an assessment of the present day, according to economists and market analysts.
Investors are essentially shrugging off the Middle East conflict as a blip that will be resolved relatively quickly, they said.
“The stock market isn’t trying to price what’s happening today,” said Joe Seydl, a senior markets economist at J.P. Morgan Private Bank. “The stock market is always trying to price what the world is going to look like six to 12 months from now.”
Why stocks have been ‘resilient’
The S&P 500, a U.S. stock index, fell about 8% in the initial weeks of the Iran war, from the start of the conflict on Feb. 28 to a recent low on March 30.
But stocks have rebounded since then, erasing all losses since the beginning of the war. The S&P 500 closed at an all-time high on Thursday — about 11% higher than its nadir at the end of March. That followed a record close on Wednesday.
“The market has remained very resilient in the face of the war and has rallied strongly on the prospect that it will be resolved,” said Mark Zandi, chief economist at Moody’s.
A ship waits to pass through the Strait of Hormuz following the two-week temporary ceasefire between the US and Iran, which is conditional on the opening of the strait, in Oman on April 8, 2026.
Shady Alassar | Anadolu | Getty Images
And while investors cheered the possibility of a diplomatic off-ramp to the conflict, the temporary ceasefire has appeared tenuous, with the U.S. and Iran each accusing the other of breaking the agreement.
Nations haven’t been able to reach a peace deal ahead of the ceasefire’s end. Vice President JD Vance said U.S. officials left peace talks in Pakistan over the weekend after the Iranian delegation refused to agree to American demands not to develop a nuclear weapon.
The markets ‘have memory’
Ultimately, the stock market is signaling a collective belief that tensions will ratchet down, the war will end in the near term and oil flows through the Strait of Hormuz will normalize, economists said.
That’s largely because investors have been conditioned to believe that President Donald Trump will back off if the economic pain becomes too intense, economists said — the so-called “TACO” trade, shorthand for “Trump always chickens out.”
“Investors strongly believe — and have been conditioned to believe — he’s going to stand down, find a way to pivot, declare victory and move on,” Zandi said.
Trump has pushed back on the notion of backing down, framing his brinkmanship as a savvy negotiating tactic.
Economists pointed to a recent example of this dynamic: in April 2025 during so-called liberation day, when the Trump administration levied a host of tariffs on U.S. trading partners.
Within days — after the stock market had cratered more than 12% — Trump announced a 90-day pause on those tariffs. Stocks then saw one of their biggest daily rallies in history following Trump’s reversal.
Investors remember that Trump often de-escalates geopolitical shocks — which is why they’ve seized on positive headlines that hint at progress in peace talks, for example, Seydl said.
“The markets have memory,” Seydl said.
AI stocks and the ‘tech boom’
Traders celebrating at the New York Stock Exchange on April 15, 2026, as the S&P 500 closed above the 7,000 level for the first time.
NYSE
There are other factors underpinning market resilience during wartime, economists said.
One is the investors’ enthusiasm for artificial intelligence and technology stocks, which account for almost half of the S&P 500’s market capitalization, Zandi said.
“Those stocks run on their own dynamic independent of anything, including the war in Iran,” Zandi said. “I think we would have been down a lot more and it would have been harder for us to recover had it not been for the very, very optimistic perspectives on AI.”
We’re in the middle of a “tech boom” — and investors are likely to remain optimistic until they think the tech cycle has run its course, Seydl said.
More broadly, stock investors are essentially making a bet on the future earnings growth of a company — and the earnings backdrop has been “pretty solid,” Seydl said.
Consumer spending appears to be stable, for example, economists said. And companies are getting a boost to their after-tax earnings from the GOP’s so-called “big beautiful bill,” which, among other things, made it easier to write off investments upfront and therefore reduce their tax liability, Zandi said.
Going forward
Experts said there will be an economic hit from the Iran war, though.
“Despite the recent news of a temporary ceasefire, some damage is already done, and the downside risks remain elevated,” Pierre-Olivier Gourinchas, director of research at the International Monetary Fund, wrote Tuesday.
A protracted conflict risks deep and global economic pain, he wrote.
Even if the conflict is short-lived — as the broad market expects — stocks are unlikely to march much higher until it’s clear the U.S. is on the other side of the war and its economic fallout, Zandi said.
If investors are incorrect, and President Trump doesn’t back down or quickly extricate the U.S. from the war, the stock market may see a “full-blown correction” or worse, Zandi said. A stock market correction is a decline of at least 10% from recent highs.
“Everyone thinks they know what the script is,” Zandi said. “Now they just need to follow the script. If they don’t, the market will have some real problems.”
The uncertainty provides yet another example of why the average investor with a long time horizon should stick to their investment plan and ignore the noise, experts said.
“Trying to time the market is very difficult if not impossible for the average investor,” Seydl said. “It’s better to take a long-term perspective and ride out bouts of volatility.”
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