Nearly 500,000 moderate-income New Yorkers will be dropped from their health insurance plans on July 1, marking the first major coverage losses from HR 1, the Republican-led law signed almost exactly one year ago. The law, sometimes called the “One Big Beautiful Bill Act,” slashed federal health spending by $911 billion nationally to fund permanent tax breaks for higher-income families and border security.
Community organizations on alert
“It’s an all hands on deck situation,” said Maia Dillane, senior director of strategy and implementation at the Arab-American Family Support Center (AAFSC) in New York City, where the bulk of the coverage losses are expected. The AAFSC is one of 20 community-based organizations working with the Community Service Society of New York to find people new health coverage. However, many families are struggling with the cost. “We’re seeing a lot of families still going back and forth on whether they can enroll in one of the qualified health plans – or whether they are just going to opt out of the coverage completely,” said Rahem Bader, director of the community health and well-being program at AAFSC. “Families are having to choose how they’re going to split their costs when it comes to their healthcare, food, etc.”
The essential plan loss
The July losses stem from the termination of New York’s “essential plan,” a provision of the Affordable Care Act. In 2023, the federal government approved a pilot program covering residents earning 200-250% of the federal poverty level – up to $39,900 for a single person or $66,625 for a family of three. The pilot was meant to last until 2028 and be deficit neutral. However, HR 1 cut essential plan funding in half and ended health insurance tax credits for lawfully present immigrants. Despite calls for state funding, New York lawmakers failed to find money in June, sealing the plan’s fate.
Broader impact across New York
The loss of the essential plan is just one piece of a larger problem. Health policy analysts at the Kaiser Family Foundation predict up to 1.1 million people could lose health insurance statewide through 2034 due to other HR 1 provisions. “This is just the tip of the iceberg, right – because come January all the other impacts of HR1 start to kick in,” said Dr. Adam Aponte, CEO of the East Harlem Council for Human Services, which operates the Boriken Neighborhood Health Center. New York City is expected to be hardest hit, with more than 250,000 residents losing insurance, including 200 of Aponte’s patients. Nationally, the law could cause an additional 10 million people to become uninsured over the next decade, largely due to new work requirements for Medicaid beneficiaries.
Strained safety net
“What do these folks turn to?” said Aponte. “Federally qualified health centers like ours are going to be likely to absorb these individuals as uninsured patients into our organizations.” He expects most newly uninsured will seek care in emergency departments. Many will be forced to shop on Obamacare marketplaces with historically high rate increases. In addition to HR 1 cuts, Congress allowed special government subsidies to health insurers to lapse at the end of 2025, leading to record-high average deductibles of $3,786 per person, according to KFF. Insurers are requesting double-digit increases for 2027, with UnitedHealthcare of New York proposing a 52.1% rate increase.
Affordability crisis
Analysts say rate increases result from sicker people seeking insurance and healthy people foregoing coverage they cannot afford. This dynamic makes insurance more expensive for everyone. Bader noted that when navigators work with families who want to opt in, “It’s because they are not looking for preventive care – they are looking for treatments for illnesses.” Despite the health disinvestment, the Congressional Budget Office projects HR 1 will add $3.4 trillion to the federal deficit by 2034 due to tax cuts.
