HR1 and Michigan Medicaid: Eligibility and Financing Impacts
The One Big Beautiful Bill Act, known as HR1, was signed into law in 2025 and represents the largest federal cuts to the Medicaid program’s history. This sweeping legislation fundamentally reshapes how Michigan’s Medicaid program is funded, who can access its services, and how health care providers are compensated. By restructuring the program along the dimensions of eligibility and financing, the law introduces new requirements for enrollees while simultaneously limiting the revenue the state relies on to support the program.
In Michigan, these changes will affect a substantial portion of the population, as nearly 2.5 million residents were enrolled in Medicaid as of May 2026. The most direct impact will be felt by the roughly 668,000 individuals enrolled in the Healthy Michigan Plan (HMP), which is the state’s Medicaid expansion program. Initial state budget assumptions projected a reduction of approximately 40,000 enrollees by fiscal year 2027; however, due to restrictive federal guidance on exemptions, the number of Michiganders losing coverage is expected to be even higher.
The proposed changes impact the state through several key mechanisms. First, many expansion enrollees will be required to perform 80 hours of work or other community engagement activities per month to maintain their coverage. Second, the law increases the frequency of eligibility checks, requiring enrollees to renew their coverage every six months instead of annually, which often creates administrative barriers that lead to loss of insurance. Third, HR1 limits payments to health care providers and caps the provider taxes Michigan uses to fund its share of the program, a shift that is projected to reduce hospital revenues and increase the amount of uncompensated care provided in the state
Read the full brief to learn more of these impacts to Michiganders.