Medicaid Cuts Are Coming: How to Prepare with Roster Monitoring

On July 4th, President Donald Trump signed the One Big Beautiful Bill Act (OBBBA) into law after it was passed by Congress. The sweeping 900-page budget reconciliation bill covers everything from energy policies to tax reforms and Medicaid spending. The bill’s cuts to federal support for Medicaid, Children’s Health Insurance (CHIP) and ACA marketplace coverage could impact millions of enrollees and reshape the financial landscape for hospitals, health systems and safety-net providers.

The passage of the OBBBA signals a pivotal shift in the way Medicaid is funded and administered in America. In response, providers must tighten their revenue cycle management processes and improve Medicaid roster monitoring to avoid preventable funding losses.

New Provisions in OBBBA

The topline is that the OBBBA is set to cut Medicaid, CHIP and ACA marketplace coverage spending by more than $1 trillion over the next ten years. This is about $200 billion more than the initial cuts set in the House version of the bill. 

To reach these cuts, lawmakers outlined several key provisions that providers should know.

Eligibility Requirements

The OBBBA delays Biden administration-era Medicaid laws that were originally designed to streamline the process for enrollees. Instead, the bill:

• Creates new requirements for verifying eligibility, including cross-checks and address confirmation.
• Narrows the retroactive coverage period to just one month (down from three).
• Eliminates the reasonable opportunity period of coverage wherein beneficiaries have the opportunity to verify their immigrant status.

In part due to these stricter requirements, the Congressional Budget Office estimates that 11.8 million people may lose coverage by 2034, not because they are ineligible, but because of paperwork errors or administrative churn.

Work Requirements

For the first time ever in the Medicaid program, certain adult beneficiaries would need to prove they are employed or in school at least 80 hours each month to remain eligible. This requirement extends to low-income parents of children over 14 as well as beneficiaries without disabilities. 

This provision has been controversial as similar efforts in the past have disproportionately impacted rural and low-income populations, causing losses in coverage.

The number of individuals at risk of losing coverage will vary based on how states implement the law. States that adopt stricter rules, such as more frequent eligibility checks or longer look-back periods, or that struggle to automate verification using existing data, may see higher coverage losses.

Caps on Funding

States will now receive a fixed amount of federal funding per enrollee, regardless of their actual healthcare costs. The patient will either have to cover the remaining amount, or the hospital will be forced to label it as a write-off. 

ACA Marketplace Disruptions

In tandem with Medicaid changes, the bill also scales back some Affordable Care Act (ACA) subsidies by an estimated $268 billion. This action will increase uncompensated care for hospitals. 

According to the American Hospital Association, the OBBBA “will force hospitals to make service line reductions and staff reductions, resulting in longer waiting times in emergency departments and for other essential services, and could ultimately lead to facility closures, especially in rural and underserved areas.”

The Bottom Line

Analyses from the Kaiser Family Foundation and Congressional Budget Office show that the combined effects of the provisions in the OBBBA could increase the national uninsured rate, reduce access to care and impose serious financial strain on hospitals, particularly those already operating on thin margins.

This comes at a time, too, when Medicaid is already in flux due to major changes from redetermination following the end of the COVID-19 Public Health Emergency (PHE). The OBBBA will likely amplify this trend. Hospitals can anticipate:

• Higher rates of bad debt
• Gaps in reimbursement 
• Increase administrative burden
• An influx of self-pay patients in emergency departments

With uncertainty on the horizon, providers need more than just a wait-and-see approach. They need systems that allow them to track Medicaid eligibility changes in real time and respond quickly when a patient loses (or regains) coverage.

What are Medicaid Roster Monitoring Tools?

Medicaid roster monitoring tools are essential for tracking real-time updates in Medicaid coverage and eligibility status. These tools run automatically in the background, eliminating the need for manual checks while preventing major financial losses.

Medicaid monitoring tools:

• Support clean claims and fewer denials
• Create a more predictable revenue cycle
• Flag patients at risk of disenrollment
• Flag newly eligible patients
• Reduce the risk of uncompensated care

Roster monitoring tools are especially critical as new eligibility rules come into play under the One Big Beautiful Bill. Instead of reacting to coverage gaps after the fact, providers can use real-time data to intervene early, closing gaps and keeping the revenue cycle moving.

How Office Ally Can Help

Office Ally’s Insurance Discovery solution includes robust Medicaid roster monitoring capabilities. The tool scans for both active and retroactive coverage, flags updates to eligibility and identifies changes in plan type. This allows providers to stay ahead of coverage changes and capture more billable opportunities.

Medicaid Roster Monitoring tool delivers real-time and retroactive eligibility checks, continuously monitors Medicaid across different plan types and adapts to custom workflows. It also requires no implementation effort and maintains a high level of accuracy with low false positive rates, ensuring your team can trust the data it provides.

Whether your patients are navigating new work requirements, responding to redetermination notices or falling through the cracks due to administrative churn, Office Ally gives you the tools to stay informed, stay compliant and stay paid.

Learn More about Medicaid Roster Monitoring

The passage of the One Big Beautiful Bill Act marks major changes to Medicaid. Providers must start preparing by investing in the technology and processes needed to keep up with these changes and protect their financial stability. 

Take control of your Medicaid eligibility tracking with Medicaid Roster Monitoring from Office Ally.

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