Added Admin Burden

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 Added Administrative Burden

How does OBBBA affect Medicaid?

  • 18.5 million adults affected: In a June 2025 analysis, the Congressional Budget Office (CBO) projected that 18.5 million adults per year overall will be affected by the new work requirements.

  • 5.2 million fewer adults with coverage by 2034: By 2034, Medicaid coverage is predicted to decrease by 5.2 million adults and the uninsured population to increase by 4.8 million people. Nearly 1 in 3 (or more than 760,000) Vietnamese people in the U.S. depend on public health insurance, including Medicaid.

How can we take action?

  • Endorse and support the LIFT the BAR Act (LTBA): Restore access to vital safety-net programs like Medicaid and SNAP for approximately 1.4 million immigrants who are currently excluded under OBBBA.  

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More paperwork costs people their healthcare coverage

Starting in 2027, Medicaid recipients will need to certify that they’ve worked or done work-related activities for 80 hours each month to maintain their Medicaid health insurance. Once the new work-related activities have been fulfilled, the work hours must still be verified or actively reported. This may be difficult for people with multiple jobs, little to no internet access, and limited English proficiency. For example, 2.3% (16,124) Vietnamese American households do not have a computer, and 6.1%  (42,762) Vietnamese American households do not have a broadband Internet subscription. Furthermore, 40% of Vietnamese Americans (over 1 million people) speak English less than “very well.” In Los Angeles County, Vietnamese Americans face the highest language barrier, with a 52% limited English proficiency rate.

Enrollees who fail to fulfill or report their work hours have 30 days to correct the issue before losing their Medicaid coverage. Those who lose coverage are also locked out of “financial help to purchase coverage through the health insurance marketplaces.”

Prior to the OBBBA, Arkansas and Georgia were the only two states to ever implement and enforce work requirements for Medicaid eligibility. In Arkansas, this resulted in more than 18,000 Medicaid enrollees losing healthcare coverage likely due to confusion about how to report work requirements and no measurable increase in employment rates. Arkansas eventually had to end its work requirements after nine months. In Georgia, this also dramatically decreased the number of Medicaid enrollees due to confusion again and has cost taxpayers over $86 million. 

Ultimately, based on these case studies, the extra time, complexity, and burden required to document work hours will likely lead to fewer eligible people staying enrolled in Medicaid. In Orange County alone, more than 154,000 Asian Americans (approximately 18% of the county) are enrolled in Medi-Cal, California’s Medicaid program. Almost 59% of adults enrolled (or 91,139 people who are ages 19 to 64 years old) are at risk of losing health coverage due to the new Medicaid work requirements. By creating these obstacles, the new work requirements threaten to defeat Medicaid’s primary purpose: serving as a reliable healthcare safety net for low-income people.

Increased paperwork for Medicaid providers burdens health systems, forcing states and providers to spend more tax dollars on administration and less on actual patient care

On June 1, the Trump administration released federal regulations detailing how states must enforce OBBBA’s new work requirements. Under these new rules, state Medicaid agencies must re-verify and update enrollee eligibility every six months instead of once a year. Because no standard medical codes currently exist to automatically deem someone "too sick to work," agency staff must spend significantly more time manually reviewing individual medical exemptions. State agencies will also face increased oversight burdens, requiring them to conduct monthly status checks to ensure physicians are complying with the new Medicaid rules. Ultimately, forcing health systems to conduct these frequent status checks diverts public funding away from healthcare services and into administrative paperwork.

Clinics and hospitals must also absorb these new administrative burdens, adding to the already growing pile of administrative work for healthcare providers. Much of this existing administrative tasks stems from billing and insurance-related tasks. In fact, the American Medical Association (AMA) highlighted this issue in 2023, noting that “the growth of health care administration positions has far outpaced that of physicians in practice.” This unequal growth is largely driven by rapid changes in technology, shifting healthcare delivery models, and increasingly burdensome government regulations. 

For instance, healthcare providers today face an overwhelming volume of administrative tasks, such as documenting patient care and logging performance metrics in electronic health records. Providers frequently cite prior authorization (PA)—the process of obtaining insurance approval before delivering a medical service—as one of their most time-consuming administrative hurdles. On average, a medical practice must complete 40 prior authorizations every week, requiring roughly 13 hours per week of valuable physician and staff time. This heavy burden forces 40% of physicians to hire dedicated staff solely to manage prior authorization paperwork. 

Prior authorization (PA): the process of obtaining insurance approval before delivering a medical service—as one of their most time-consuming administrative hurdles

Source for images: https://www.ama-assn.org/system/files/prior-authorization-survey.pdf 

Healthcare providers consistently report that mounting administrative tasks take away valuable time from delivering quality patient care and communicating with patients. In 2023, physicians spent nearly 8 hours of an average 59-hour work week, roughly 14% of their work week, solely dedicated to administrative tasks other than medicine. Compounding this crisis, “growing regulatory and administrative burdens are the leading cause of physician burnout,” with around 45% of physicians reporting at least one symptom of burnout in 2023.


Additionally, states will face stiffer financial penalties and reduced federal reimbursements for any administrative errors made under the complex new Medicaid rules. Starting in 2029, states with erroneous Medicaid payment rates exceeding 3% will have to repay the federal government. The current nationwide Medicaid error rate stands at 6%, which is twice the newly allowed limit, with more than 75% of these errors stemming entirely from inadequate documentation.

These reduced reimbursements will drive up state health system costs, diverting critical tax dollars toward processing paperwork rather than delivering actual patient care. Ultimately, these mounting financial burdens could force closures of health clinics and community hospitals, particularly in rural areas that rely heavily on Medicaid to stay open.

Excessive paperwork blocks vulnerable people from accessing essential healthcare services.

The compounding administrative burdens placed on state agencies and physicians to verify exemptions will inevitably result in fewer approvals for eligible Medicaid participants. This reduction in approved exemptions will directly harm high-need groups, including pregnant and postpartum people, people with disabilities, and family caregivers. These systemic hurdles pose a significant threat to the Vietnamese American community, where women make up over half of the population in the U.S. at 1.2 million Vietnamese American women. Of this total, roughly 27% or 658,200 women are of potential childbearing age and highly vulnerable to losing critical maternal care. Furthermore, these administrative barriers endanger the 252,497 Vietnamese Americans currently living with a disability. These compounding barriers will create severe, systemic gaps in healthcare access for the communities that need it most.

Overall, the U.S. spends significantly more on healthcare administration than peer nations, even though at least half of the administrative costs do nothing to improve patient health outcomes. By forcing health systems to track hours and verify exemptions, OBBBA will severely worsen this imbalance, funneling precious public funding into bureaucratic paperwork rather than actual medical care.

How can we take action?

To push back against this inequitable public health policy, local, national, and international organizations can endorse the LIFT the BAR Act (LTBA). This crucial legislation aims to restore access to vital safety-net programs like Medicaid and SNAP for approximately 1.4 million immigrants who are currently excluded under OBBBA. Recent polling shows a majority of Americans support reversing healthcare cuts aimed at immigrant families, especially as OBBBA pairs these safety-net cuts with tax breaks for the wealthiest corporations and individuals. Supporting the LTBA is a necessary step toward ensuring equitable healthcare access, protecting public health, and restoring dignity for all.