Now that the big beautiful bill has passed, what does it mean for New Jersey home care recipients
The Impact of the One Big Beautiful Bill Act on Home Care Recipients in New Jersey
On July 4, 2025, President Donald Trump signed the One Big Beautiful Bill Act (OBBBA) into law, a sweeping piece of legislation that introduces significant changes to Medicaid, taxes, and other federal programs. For home care recipients in New Jersey, who rely on Medicaid’s NJ FamilyCare program for critical home- and community-based services (HCBS), the bill’s provisions—particularly its $1 trillion in Medicaid cuts over the next decade—will have profound implications. This article explores how the OBBBA will affect the approximately 1.8 million New Jerseyans, including those receiving home care, and what they can expect in the coming years.
Medicaid Cuts and Their Impact on Home Care
The OBBBA imposes the largest Medicaid cuts in the program’s history, reducing federal funding by about $1 trillion nationwide over 10 years. In New Jersey, the state Department of Human Services estimates that the state will lose $3.6 billion annually in federal Medicaid funding, representing nearly 25% of its expected allocation. This reduction threatens the sustainability of NJ FamilyCare, which provides comprehensive health coverage, including HCBS, to low-income individuals, seniors, children, and people with disabilities.
For home care recipients, who depend on HCBS to receive assistance with daily activities like bathing, dressing, and meal preparation in their own homes, these cuts could lead to:
- Reduced Access to Services: States facing massive funding shortfalls may cut back on optional Medicaid services, such as HCBS, to balance budgets. In 2020, the average per capita spending on HCBS was $36,275. The OBBBA allocates just $50 million in 2026 and $100 million in 2027 for a new HCBS waiver program, which would cover services for only about 27 people per state annually—far from sufficient to meet demand. As a result, wait times for HCBS in New Jersey could lengthen, leaving many without timely care.
- Increased Financial Burdens: Starting in October 2028, Medicaid expansion enrollees (those earning up to 138% of the federal poverty level, or $21,597 for an individual in 2025) will face new out-of-pocket costs, including copays of up to $35 per visit for most services. For home care recipients with frequent caregiver visits, these costs could accumulate quickly, straining limited budgets.
- Potential Loss of Coverage: The Congressional Budget Office (CBO) projects that 7 million people nationwide will lose Medicaid coverage over the next decade due to the bill’s cuts and new eligibility requirements. In New Jersey, about 350,000 NJ FamilyCare recipients—roughly 1 in 5—could lose coverage, including half of those enrolled through the Affordable Care Act (ACA) Medicaid expansion. For home care recipients, losing coverage could mean losing access to caregivers, forcing reliance on family members or institutional care.
New Work Requirements and Administrative Burdens
The OBBBA introduces strict work requirements for Medicaid recipients aged 19 to 64 who are deemed “able-bodied” and enrolled through the ACA Medicaid expansion. Starting as early as January 2027, these individuals must work, volunteer, or attend school for at least 80 hours per month to maintain coverage. Exemptions exist for pregnant women, caregivers of children 13 or younger, and people with disabilities, but proving eligibility for exemptions requires extensive documentation.
For home care recipients, these requirements pose significant challenges:
- Barriers for People with Disabilities: Many home care recipients have disabilities that may not qualify them for automatic exemptions through Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI). The bill’s work requirements could penalize those who struggle to work due to health conditions or lack of accessible transportation. Over 2.6 million adults with disabilities nationwide could be at risk of losing coverage.
- Increased Paperwork: All Medicaid recipients, including those exempt from work requirements, must submit regular documentation, such as pay stubs, to prove eligibility. Starting in 2027, New Jersey will conduct eligibility checks every six months, up from annually. Health care providers warn that these “onerous” requirements could lead to coverage losses due to missed paperwork or lack of awareness, particularly for seniors and people with disabilities who rely on home care.
Impact on Health Care Providers and Infrastructure
The OBBBA’s Medicaid cuts will also affect New Jersey’s health care providers, including home care agencies, which could further limit access to services. The bill caps and reduces provider taxes, a key funding source for state Medicaid programs, by $375 billion nationwide. This restriction, combined with reduced federal funding, could force home care agencies to scale back services or close, especially in rural areas.
New Jersey hospitals, which rely on Medicaid for $300 million annually, face increased uncompensated care costs as more residents lose coverage. This could lead to overcrowded emergency departments, longer wait times, and reduced capacity to support community-based care programs. Human Services Commissioner Sarah Adelman has called the cuts “inhumane and appalling,” noting that they threaten the entire health care system.
Specific Impacts on Vulnerable Groups
- Seniors: Many seniors in New Jersey rely on Medicaid to cover long-term care services not covered by Medicare, such as HCBS. The OBBBA’s funding cuts and restrictions on state financing could force the state to reduce these services, pushing seniors toward nursing homes or leaving them without adequate care. The bill also blocks implementation of rules that would have simplified access to Medicare Savings Programs, increasing out-of-pocket costs for low-income seniors.
- People with Disabilities: Disabled individuals, who are more likely to rely on Medicaid in rural areas, face heightened risks. The bill’s cuts could exacerbate existing disparities, as rural hospitals and home care agencies struggle to stay afloat.
- Immigrants: The OBBBA restricts Medicaid eligibility for many lawfully present immigrants, including refugees and asylees, and eliminates coverage for undocumented immigrants, even for emergency care in some cases. This could increase uncompensated care costs for home care providers serving diverse communities.
Timeline of Changes
The OBBBA’s changes will roll out over several years, giving New Jerseyans some time to prepare but also creating uncertainty:
- January 2027: Work requirements begin for “able-bodied” adults, and eligibility redeterminations shift to every six months. Retroactive coverage is limited to one month for expansion enrollees and two months for traditional enrollees.
- October 2028: Medicaid expansion enrollees face new out-of-pocket costs for services.
- Ongoing: Federal funding reductions will force New Jersey to make tough budgetary decisions, potentially leading to earlier cuts in HCBS or other services.
What Home Care Recipients Can Do
Home care recipients in New Jersey should take proactive steps to navigate these changes:
- Stay Informed: Monitor updates from the New Jersey Department of Human Services and NJ FamilyCare for guidance on new requirements and eligibility processes.
- Prepare Documentation: Begin gathering proof of income, work hours, or exemption qualifications (e.g., disability or caregiving status) to ensure compliance with work and eligibility requirements.
- Advocate: Engage with local advocacy groups, such as AARP or Planned Parenthood Action Fund of New Jersey, to push for policies that protect Medicaid funding and access to HCBS.
- Explore Alternatives: Consult with social workers or community organizations to identify other resources, such as nonprofit home care programs, if Medicaid coverage is reduced.
