Federal Law Strips Medicaid Coverage from Hundreds of Thousands of Legal Immigrants

Starting October 1, 2026, hundreds of thousands of lawfully present immigrants will lose access to federally funded health coverage under new federal restrictions. The changes stem from H.R. 1 (Public Law: 119-21), also known as the One Big Beautiful Bill Act, which President Donald Trump signed into law on July 4, 2025. The legislation restricts eligibility for Medicaid, the Children’s Health Insurance Program (CHIP), and coverage through the Affordable Care Act (ACA) marketplaces, affecting refugees, asylum-seekers, sex-trafficking victims, and other humanitarian immigrants.

The Congressional Budget Office estimated that 100,000 more immigrants will be uninsured by 2034 because of the Medicaid eligibility changes. However, a KFF Health News survey of nine states found many more are at imminent risk of losing health coverage. These individuals include refugees admitted through the U.S. Refugee Admissions Program, individuals granted asylum, certified survivors of human trafficking, Cuban and Haitian entrants, Amerasian immigrants, and Afghan and Iraqi nationals admitted on Special Immigrant Visas who supported U.S. combat operations.

In Washington state alone, approximately 11,000 refugees, asylum-seekers and other lawful immigrants will lose health insurance when the changes take effect. Ryan Moran, director of the state Health Care Authority, described the situation as creating understandable fear among affected individuals. The agency administers Apple Health, Washington’s Medicaid program, and has been running an “all hands on deck” operation to warn patients of the coming changes.

Historical Framework and Policy Shifts

Since enactment of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, federal law has linked public-benefit eligibility to immigration status. Most lawfully present immigrants must wait five years after obtaining a qualifying status before enrolling in federal programs such as Medicaid. Congress, however, exempted individuals admitted on humanitarian grounds from this waiting period and subsequently added other eligible categories.

This exemption reflected the practical circumstances of humanitarian populations, whose arrival is generally determined by government processes rather than individual choice. Many arrive after experiencing persecution, torture, or exploitation and many have untreated medical conditions, limited resources, no employer-sponsored coverage, and little or no family support in the United States to fall back on. A five-year waiting period could therefore leave serious health needs unaddressed for vulnerable populations who fled life-threatening circumstances.

Under the new federal law, Apple Health eligibility will now be limited to U.S. citizens and nationals, lawful permanent residents who have been here longer than five years, Compacts of Free Association islanders, and certain Cuban-Haitian immigrants. Those who are no longer eligible include asylum-seekers, refugees and victims of trafficking, among others. Children, pregnant people and those within 12 months postpartum continue to be eligible for Apple Health regardless of immigration status, if they meet other requirements.

Washington State Responds to Coverage Crisis

Initially about 14,000 lawfully present residents in Washington were set to lose coverage with Apple Health, Moran said, but the figure dropped over the last year as providers and state teams have helped members update their information to keep coverage. The agency has been working intensively, particularly in recent months, to reach affected populations and explain their options. “The very harsh reality is that the federal government and President Trump and Congress passed this law that will remove individuals overnight from Medicaid with no other option,” Moran said. “Those are often heartbreaking conversations.”

Local providers and health leaders warn the result will likely be sicker patients, higher out-of-pocket costs, and an enormous weight on an already overburdened healthcare system. The ripple effects of this mass loss of health insurance will likely hit everyone in the state over the next year, Moran said. When uninsured individuals delay care and eventually seek treatment in emergency rooms, the costs shift to hospitals, taxpayers, and other insurance premium payers.

Additional Changes and Work Requirements

In January 2027, another H.R. 1 change will impact more than 600,000 Washington residents who will be subject to new work requirements at the start of the year. These individuals will be required to reapply for coverage twice as frequently as under current regulations, creating additional administrative burdens for both enrollees and state agencies. The combination of eligibility restrictions and increased documentation requirements threatens to create gaps in coverage even for those who technically remain eligible.

The U.S. Conference of Catholic Bishops’ Migration and Refugee Services has previously reported on the scope of these changes for lawfully present noncitizens who have historically had access to federally funded assistance programs. Refugee Medical Assistance (RMA) remains available for certain eligible populations, though this program offers only limited, time-restricted coverage compared to full Medicaid benefits. For many humanitarian immigrants, RMA will provide insufficient protection against catastrophic medical expenses or management of chronic conditions.

Nationwide Impact and Healthcare System Strain

Beyond Washington state, the policy shift affects hundreds of thousands of immigrants living in the country legally who no longer qualify for Medicaid nationwide. KFF Health News rural health reporter Andrew Jones joined WAMU’s Health Hub to explain which Medicaid enrollees are affected in the Washington, D.C., region and what other cuts to health services for immigrants are next. Safety-net healthcare providers, community health centers, and emergency departments across the country are bracing for increased demand from uninsured patients.

Healthcare advocates emphasize that many of those losing coverage arrived after experiencing severe trauma and have complex medical needs. Without consistent access to preventive care, prescription medications, and specialist treatment, their conditions may deteriorate until emergency intervention becomes necessary. The cost of that emergency care-legally required under federal law regardless of insurance status-will be absorbed by hospitals and ultimately passed on to communities through higher healthcare costs for everyone.

Limited Options for Affected Immigrants

For those losing coverage, remaining healthcare options are severely limited. Some may qualify for subsidized coverage through ACA marketplaces, but the new law also restricts marketplace eligibility for many immigrant categories. Others will be forced to rely on free clinics, charity care programs, or forgo treatment altogether until medical crises force emergency room visits. Community health centers that serve immigrant populations report they are already overwhelmed and expect the situation to worsen significantly after October 1.

The policy represents a fundamental shift in how the United States provides healthcare to individuals it has admitted on humanitarian grounds. For decades, the exemption from the five-year waiting period recognized that refugees and trafficking victims arrive under circumstances beyond their control and need immediate support. The elimination of that exemption places financial and health burdens on some of America’s most vulnerable legal residents while simultaneously straining the broader healthcare system that will ultimately bear the cost of their uncompensated care.