New Medicaid and SNAP rules shift billions of costs to state budgets
Starting Oct. 1, states must cover 75% of SNAP administration costs and face tighter Medicaid eligibility rules, adding billions in expenses.
On Oct. 1, several sections of President Donald Trump’s One Big Beautiful Bill Act take effect, moving 75% of SNAP administrative costs to the states and lowering the federal share to 25%, a change projected to cost states nearly $17 billion over five years. The law also narrows Medicaid and CHIP eligibility to green-card holders, certain nationals from Cuba, Haiti, and the Freely Associated States, and lawfully residing children and pregnant parents, which the Congressional Budget Office estimates will strip about 100,000 people of health coverage by 2034.
Immigrant groups such as refugees, asylees, and victims of trafficking lose SNAP benefits and must undergo a lengthy verification process that could lead to procedural disenrollments. Experts from Brookings, the Center on Budget and Policy Priorities, and one outlet note that the required staffing, oversight, and system upgrades will strain already tight state budgets, potentially prompting cuts to benefits or stricter eligibility rules. Recent surveys show a significant drop in Medicaid, CHIP, and SNAP enrollment since the law’s passage, underscoring the fiscal pressure on state governments.
Why it matters
States will face billions in new costs and stricter eligibility rules, threatening food and health assistance for vulnerable residents.
How the sides frame it
MODERATE AGREEMENTBoth camps note the cost shift to states, but left-leaning coverage stresses the loss of coverage for vulnerable and immigrant groups, while centrist coverage presents the reforms as potentially improving accountability and cutting federal spending despite possible hardship.
LEFT
Frames the rules as harsh cuts that will strip coverage from vulnerable populations and shift billions of costs to states
CENTER
Frames the reforms as a mixed bag that could boost accountability and lower federal outlays while also risking hardship for some households
The left emphasises
- shift billions of costs to states
- strip about 100,000 people of health coverage
- immigrant groups lose SNAP benefits and face lengthy verification
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