Medicaid and Medicare are the two most successful health care programs in the history of the United States. Signed into law in 1965, the two programs now ensure coverage for over 160 million people, or over one-third of all Americans. Over the years, both have been expanded and improved to cover more people at lower cost and with greater efficiency than private insurance. Currently, Medicaid provides coverage to over 2,845,000 people in North Carolina, including more than 347,000 children in the Medicaid-related Children’s Health Insurance Plan (CHiP).
Yet, this year, as Medicaid and Medicare turn 61, patients who rely on these programs are at high risk of losing their coverage because recent changes under President Trump’s 2025 signature law, the One Big Beautiful Bill Act (OBBBA), will gut funding and make coverage much harder to access. The ugly truth about the OBBBA is that it slashes nearly $1 trillion in funding from the programs to pay for extended tax breaks for wealthy households and corporations. If you think that’s a terrible trade-off, you’re not alone: nearly 80% of Americans have a favorable view of Medicaid and fewer than 20% wanted reduced spending in the program in mid-2025 while the OBBBA was being debated in Congress.
Although the Medicaid changes are not yet fully implemented, North Carolina and other states are now putting in place complex new paperwork requirements that will increase administrative costs in Medicaid while at the same time gutting coverage. The OBBBA will strip over 10 million people of their health coverage over the next few years even as the cost of private insurance premiums soar, leaving many people with no affordable health care options in the near future.
In fact, the same insurance companies that more than doubled premiums for Affordable Care Act marketplace coverage in 2026 and are proposing more double-digit premium increases for 2027, are also the corporations benefiting from tax breaks under the OBBBA. While CEOs and shareholders get tax breaks, average Americans face shrinking coverage, cuts to Medicaid-funded services, and the closure of local hospitals, health centers, and nursing homes caused by the law.
In North Carolina, 515,000 are at risk of losing Medicaid coverage because of the OBBBA. At the same time, the richest 1% of households in North Carolina – those earning more than $867,000 a year- will get an annual tax cut of $61,150 under the same law. By contrast, the lowest income people in North Carolina – those earning less than $25,200 – will receive only a $20 additional tax break even as the cost of food, rent and consumer goods keep increasing thanks to inflation and tariffs.
The new Trump law gives average Americans little to celebrate on this year’s Medicaid and Medicare birthday.. Slashing Medicaid, which patients, hospitals and state budgets depend on for everything from health coverage to staffing, school services for children with disabilities, emergency response and public safety, takes health in the wrong direction.
It doesn’t have to be this way.
Instead of attacking health care programs with a proven track record, lawmakers in Congress should be trying to duplicate the key features of Medicaid and Medicare that lower prices, guarantee affordability and ensure universal access. For instance, if the federal government implemented price negotiations and uniform rates in private insurance the way they already do in Medicaid and Medicare, health care costs would decrease because corporations would no longer have monopoly power to set their own prices and raise them anytime.
But rather than apply lessons from Medicaid and Medicare that would make health care work better for all of us, President Trump and Republicans in Congress traded our Medicaid for more tax breaks to the wealthiest households and corporations.
The next Congress must do better. It’s time for policymakers to address the root cause of unaffordable costs by leveraging the watchdog power of government to lower prices, end price-gouging to artificially boost prices, and make sure that everyone can get the healthcare coverage they need when and where they need it. It’s time for Congress to make health care work for all of us.
Pat McCoy is the Senior Project Manager for Health Care Justice at ActionNC.
