What the Cuts in the Mega-Budget Bill Mean for Texas Families

Whether you call it the Big Beautiful Bill, the Big Bad Bill, or something else, we're deeply concerned about the budget reconciliation bill that Congress recently passed and the President signed.

We want to take a moment to thank all of our partners and supporters who joined with us in speaking out against the proposed cuts in the bill over the last several months. The bill that passed is certainly bad news for kids and families across Texas — but we know it would have been even worse if we hadn’t raised our voices together.

We also want to give you more information about what the bill means for kids and families in Texas and other states. Our team and other policy experts are still analyzing the bill to understand the last minute changes that Congressional leaders made as they rushed it through the legislative process. However, we know the broad strokes:

Medicaid Cuts

We’re very concerned that about 200,000 Texans will lose their Medicaid health insurance and become uninsured as a result of the bill. (About four million Texans — kids, pregnant women, seniors, and people with disabilities — are currently enrolled in Medicaid health insurance.) It’s important to note there are much deeper cuts in the bill targeting states that have expanded Medicaid to include low-income adults.

For states like Texas, the bill adds new red tape for Medicaid applicants and maintains old red tape that was scheduled to disappear. For example, a 2024 federal rule required states to give families more time to respond to eligibility questions and to look at specific data sources to confirm eligibility so a family does not have to send in more paperwork or pay stubs. The bill pauses those positive steps for at least a decade. As a result, parents will have to submit more paperwork and pay stubs — with tighter deadlines — instead of the state efficiently using data it has at its fingertips. Additionally, by stopping the 2024 federal rule, Texas will revert to a three-month waiting period before a child qualifies for CHIP health insurance, as well as annual and lifetime limits on CHIP benefits.

The bill also prohibits states from adding new Medicaid “provider taxes” in the future. That restriction will make it harder to pump new health care funding into communities as their population grows, particularly in counties that have not already established provider taxes. Over time, it will be harder to finance key health services — such as labor and delivery — in these counties.

ACA Cuts

About 560,000 Texans will lose health coverage due to the new restrictions on enrollment in HealthCare.gov insurance plans. Some people refer to these as Affordable Care Act (ACA) Marketplace plans or just “Obamacare.” Another 1.2 million Texans will likely lose their HealthCare.gov insurance if Congress fails to extend the extra subsidies (“enhanced premium tax credits”) that it created in 2021 to drive down the costs of these plans. 

Adding it all up, about 2 million Texans could lose their health insurance — making it harder for them to go to check-ups, buy their medications, get healthy before a pregnancy, attend cancer screenings and treatments, and more.

SNAP Cuts

We’re deeply concerned that Texas children will go hungry as a result of the bill. About 275,000 Texans are now at risk of losing food assistance from the Supplemental Nutrition Assistance Program (SNAP) because the bill extends current SNAP work requirements to adults between age 55 and 65 as well as parents of children 14 and up. (Approximately 3.5 million Texans are currently enrolled in SNAP.) 

The bill also shifts SNAP costs from the federal government to the state, including $90 million in administrative costs starting in FY 2027 and $700 million in food benefits starting in FY 2028. Our colleagues at Feeding Texas have more details on these and other SNAP cuts in the bill.

Other Concerns

The combined impact of these cuts across Texas and across the country will be devastating — and this is only a partial list of the consequences of the bill. Policy experts have also warned that the budget deficit will skyrocket under the bill, for example.

Moving Forward

We will continue to analyze and share information about the impact of the bill, including the timeline for different provisions to take effect. Congress scheduled many of the cuts to take effect after the 2026 election. Along with our partners, we will work to see if there are ways we can limit the damage of the cuts in Texas. Additionally, heading into the 2027 Texas legislative session, lawmakers must be prepared to invest the state’s new share of SNAP costs in order to keep food on the table for families across the state. 

We appreciate your partnership in these efforts to support Texas kids and families!