Medicaid covers 1.2M Minnesotans. What could the U.S. House bill mean for the state?

Changes to Medicaid, including a stringent work requirement, are key to the massive domestic policy bill the U.S. House passed early Thursday morning.

And they have many Minnesotans worried. The health care program — called Medical Assistance in Minnesota — covers roughly 1.2 million low-income people in the state, including children, seniors and people with disabilities.

Minnesota’s Department of Human Services published an analysis of federal Medicaid cuts Wednesday titled “An Obstacle Course of Red Tape, Hurdles and Traps Driving up Costs and Forcing States, Counties, Tribes and Providers to Push Minnesotans Off Health Care Coverage.”

It noted that the Kaiser Family Foundation estimates up to 253,000 Minnesotans could lose coverage. It also said new hurdles are designed to kick people off health care coverage and the changes — including requiring eligibility checks every six months instead of once a year — would bury front-line workers and enrollees in paperwork and red tape.

The analysis, which did not account for last-minute tweaks to the bill, estimated the state would lose $500 million annually.

Congressional Republicans looked to cut spending on Medicaid and other programs in the sweeping package that contains many of President Donald Trump’s goals, including extending tax cuts from 2017.

But work on what Trump has repeatedly called “the big, beautiful bill” isn’t over. Next it heads to the Senate, where some Republican members have opposed major Medicaid cuts.

Here are some of the key Medicaid changes in the narrowly approved U.S. House version of the bill:

Medicaid recipients — with some exemptions — would have to meet a “community engagement” requirement. They must do at least 80 hours a month of work or community service, or be enrolled at least part-time in an educational program, or some combination of those activities.

In a last-minute change to appease more conservative House members, Republicans moved up the start date for the work requirements from 2029 to Dec. 31, 2026.

Some local advocates warned the measure would create new red tape and lead to people losing their coverage, even if they qualify for exemptions or are working.

Minnesota’s Medical Assistance program covers gender-affirming care for transgender people. Under the House measure, federal Medicaid funding could not be used for such services. The change initially would have only applied to minors, but a last-minute amendment made the prohibition apply broadly.

Health care providers that offer abortion services, including Planned Parenthood, would also lose federal dollars under the bill.

The bill aims to penalize states, including Minnesota, that offer health coverage to undocumented immigrants by reducing their federal Medicaid funding.

While undocumented people don’t qualify for Medicaid coverage, some states use other dollars to provide them with care. Minnesota started offering coverage to undocumented people in January through its MinnesotaCare program, which is distinct from Medicaid.

Meanwhile, at the State Capitol lawmakers are weighing whether to end that coverage for adults, but continue it for undocumented children.

Many states tax health care providers and return the dollars through an increased federal match, using a mechanism that allows states to collect more in federal Medicaid funds.

The practice has come under scrutiny from some Republicans who have derided the “loophole,” and the House bill would limit the move, saving the federal government money.

The potential change comes as local hospital leaders have been pushing Minnesota lawmakers this year to use the mechanism to get additional federal Medicaid dollars. Hospital officials warn they are facing budget pressures that may force them to make cuts to services Minnesotans depend on.