Republican tax and spending cut megabill expected to take billions from Oregon Health Plan

Beginning in 2027, Oregonians must prove they work to receive health insurance coverage under Medicaid

The Oregon Health Authority expects that up to 200,000 Oregonians could lose their health insurance coverage through Medicaid in the next decade due to new eligibility requirements passed in Congressional Republicans' massive tax and spending cut bill.

Beginning in 2027 adults between 19- and 64-years old who are enrolled in the Oregon Health Plan, Oregon's Medicaid program, must prove through monthly paperwork that they were employed, went to school or volunteered at least 80 hours during the previous month.

Nearly 1.3 million Oregonians receive Medicaid benefits today. This includes about half of the state's kids, as well as 60% of nursing home residents and 50% of adults with disabilities.

And most Oregon Health Plan members, more than 70% of them, already work, according to KFF, a health information nonprofit.

The bill language includes exemptions to the work requirements for youth, seniors, people with physical and mental health disabilities and pregnant women, but the burden of complying with new and frequent paperwork and reporting requirements is likely to result in many losing coverage, according to Oregon Health Authority spokesperson Amy Bacher.

An earlier version of the bill that attempted to penalize states like Oregon that offer Medicaid coverage to all qualifying applicants, regardless of citizenship, would have further cost the state. The Senate removed that provision in the final bill that passed and was signed on July 4 by President Donald Trump.

In all, Oregon is projected to lose up to $1.4 billion per year in federal Medicaid funding, and up to $16 billion in the next decade if people don't comply with the new work reporting requirements, Bacher said.

And Oregon taxpayers will be on the hook for hundreds of millions of dollars needed to update software and technology systems, and add administrative positions, so the new work reporting requirements can be met, Oregon Health Authority Medicaid Director Emma Sandoe told the Capital Chronicle.

"The administrative burden will also be felt by Oregon Health Plan members, who will be forced to navigate complex eligibility rules and fill out time-consuming paperwork, creating the probability of approximately 200,000 people losing coverage," Sandoe said in an email.

Oregon's almost entirely Democratic congressional delegation voted against the GOP tax and spending cut bill. Only U.S. Rep. Cliff Bentz, Oregon's sole Republican congressman from the state's 2nd Congressional District, voted to pass it.

Capping taxes on health providers

The Republican megabill also changes how much states can tax medical providers — a strategy that all states except Alaska use to increase revenue for their Medicaid programs, that can then be matched by federal dollars.

Provider taxes fund about a quarter of the Oregon Health Plan, Oregon Public Broadcasting recently reported. But starting in September, Oregon's 6% provider tax will have to gradually decline, reaching 3.5% by 2032.

This will reduce Medicaid funding by $50.4 billion nationally over the next ten years, putting both urban and rural hospitals at risk, Bacher said.

"Safety-net hospitals in urban areas, already seeing high rates of uninsured patients, may face mounting uncompensated care costs, while rural hospitals — vital to local economies — may be forced to cut services or even close," Bacher said.

Medicaid coverage at reproductive health clinics in limbo

The Republican megabill also blocks Medicaid funding for one year to any sexual and reproductive health care clinics, such as Planned Parenthood, that provide abortions and that received more than $800,000 in federal and state Medicaid funding between 2022 and 2023.

There are 12 Planned Parenthood clinics in Oregon, eight of which are a part of the Planned Parenthood Columbia Willamette network. Between 2023 and 2024, doctors at those clinics treated more than 40,000 Medicaid patients.

The bill threatens funding for Planned Parenthood affiliates in Oregon that already operate under budget deficits. The national Planned Parenthood organization sued the Trump administration Monday over the cuts, and a federal district court issued a temporary restraining order blocking the cuts to Planned Parenthood for at least two-weeks.

At this time, Planned Parenthood Columbia Willamette is continuing to serve patients covered by Medicaid, regardless of its ability to be reimbursed for the services it provides, according to spokesperson Kristi Scdoris.

She said the law puts in jeopardy care for thousands of patients who rely on Planned Parenthood for essential services like birth control, testing and treatment for sexually transmitted infections, and cancer screenings.

"In moments like this, our mission is our anchor: to provide, promote, and protect access to sexual and reproductive health care," Scdoris said. "We will meet this moment, no matter what. Our doors are open, and we are still providing the full scope of services at all nine of our health centers throughout Oregon and SW Washington."