Updates About Legislation

On July 4, 2025, the One Big Beautiful Bill Act of 2025 (OBBBA) was signed into law. As a result, Michigan is facing significant and concerning updates to its Medicaid and SNAP programs that will have wide-reaching effects on residents’ health and access to essential services. These changes are expected to reduce coverage and support for many vulnerable populations.

The Supplemental Nutrition Assistance Program (SNAP) supports over 1.7 million Michigan households, helping prevent food insecurity. Key changes include:

• Low-Income Home Energy Assistance Program (LIHEAP) deduction may reduce SNAP benefits
• Internet Expense Deduction removed
• Work Requirements: Waiver for Able-Bodied Adults Without Dependents (ABAWDs) is being rolled back, requiring more individuals to work or face SNAP loss
• Changes to Immigrant Eligibility: Certain refugees and asylees previously considered eligible may have benefits reduced or terminated
• Enrollment Frequency: Enrollment for SNAP may now occur every six months, instead of annually
• Error Rate-Based Funding Cuts: States will be required to pay a portion of SNAP benefits based on their Payment Error Rate (PER), effective FY28
• Administrative Cost Shift: Federal funding for SNAP administration will decrease from 50% to 25% starting FY27, requiring Michigan to cover 75% of administrative costs

Medicaid currently provides coverage for roughly one in four Michiganders and is a critical lifeline for low-income residents. Major updates include:

• New work requirements for Healthy Michigan Plan (HMP):
  • Applies to enrollees ages 19-64
  • Must work, train, or volunteer at least 80 hours per month to maintain coverage
  • Many exemptions and exceptions
  • Effective January 1, 2027
• Six-month redeterminations instead of renewing eligibility annually
• Retroactive eligibility Limits (previously 90 days prior to application):
  • HMP: Coverage now only 30 days prior to application
  • Other Medicaid programs: Coverage now only 60 days prior to application
  • Effective January 1, 2027
• Fewer coverage pathways for non-citizens
  • Some lawfully present non-citizens may receive Emergency Services Only (ESO) coverage
  • Lawful permanent residents remain eligible
  • No longer eligible: Refugees, asylum grantees, trafficking victims, and more
  • Effective October 1, 2026
• Financing and Provider Changes:
  • Insurance Provider Assessment (IPA) tax to be discontinued
  • Gradual reduction of provider tax cap
  • State Directed Payments (SDP) to providers now capped at Medicare rates (replacing prior commercial-rate cap)

For a full review of the projected impacts of these changes on Michigan residents, see this Medicaid and SNAP Impact presentation by MDHHS shared during a Senate Appropriations committee hearing.

The first half of 2025 has produced the lowest number of public acts during an active legislative session in Michigan history. Only six public acts have been signed into law, far below the nearly 200-bill average typically passed by mid-July. The only instances with fewer laws enacted were years when the Legislature didn’t convene at all. Prior to 1951, the Legislature typically met every two years, but even in years with brief special sessions, more was accomplished. For instance, during the Spanish-American War in 1898, lawmakers passed eight public acts in just 22 days. This sluggish pace has been attributed to the partisan standoff between the Republican-led House and Democrat-controlled Senate, with observers on both sides pointing to a breakdown in bipartisan cooperation and growing political polarization.

Tensions reached a boiling point in the Michigan House last week after Rep. Alabas Farhat (D-Dearborn) was abruptly removed from his post as minority vice chair of the House Appropriations Committee by Speaker Matt Hall (R-Richland Twp). The move followed Farhat’s no vote on HB 4506, a Republican-backed bill that would allow life without parole for 19- and 20-year-olds convicted of particularly violent crimes, and HB 4141, which proposed banning cell phone use by students in schools.

Farhat defended his vote, arguing the policy deserved further debate and that Democrats were given little time to review final language. Speaker Hall, however, claimed Farhat failed to uphold a commitment and pointed to his resistance during budget talks as further justification. The session, which lasted more than seven hours, ended with no bills passed and deepened uncertainty over who will now represent House Democrats in ongoing—and already strained—budget negotiations.