Impact of New Law in Tennessee
Recent estimates from various policy organizations indicate that cuts to Medicaid and Affordable Care Act health insurance, along with President Donald Trump’s newly signed law aimed at extending tax cuts while altering SNAP benefits, are set to significantly affect Tennessee.
Trump enacted the law on July 4th, referred to as the “Big Beautiful Bill.” Tax reductions will roll out quickly, but the overall effects on social safety net programs will materialize gradually in the coming years.
These funding cuts to Medicaid and the Supplemental Nutrition Assistance Program (SNAP) are largely attributed to new job requirements for adults. This change introduces additional documentation that could lead to disqualification for many recipients who find it hard to keep up.
According to KFF, a nonprofit health policy organization, the adjustments in funding concerning Affordable Care Act Market Insurance could affect about 2% of Tennesseans, translating to roughly 68,000 individuals losing their federally granted insurance. This aligns with projections from the U.S. House Democrats’ Joint Economic Committee, which foresees an even more severe outcome affecting around 170,000 people.
In terms of Medicaid, Tennessee will see fewer options available under its Tenncare program. The state is one of only ten that did not expand its program to cover more individuals living near the poverty line.
Interestingly, around 300,000 Tennesseans could receive Medicaid if state lawmakers opted to extend coverage permitted by the Affordable Care Act. With fewer people insured, it’s clear that many will experience coverage loss.
Moreover, Tennesseans might face a reduction of about 20% in their SNAP benefits. As reported by the U.S. Department of Agriculture, nearly 700,000 Tennesseans accessed approximately $1.4 billion in SNAP assistance in 2022, with a significant portion being children who qualify for federal aid.
By 2026, Tennessee is projected to garner around $7 billion in income tax, according to analysis from various sources utilizing U.S. Census data. However, it’s expected that the bulk of these tax breaks will primarily favor the wealthiest households in Tennessee.
Who Supported the Legislation?
All Republican lawmakers in Tennessee supported this legislation, including both GOP senators from the state.
Senator Marsha Blackburn expressed that the law will implement what she termed “the biggest tax cuts in American history,” aimed at aiding individuals and families struggling with inflation and excessive spending over the past four years.
The only dissenting voice from Tennessee was Democratic Congressman Steve Cohen from Memphis. He criticized the legislation, stating that it fails fundamental moral standards by undermining essential food and healthcare for the poor while enriching the wealthiest individuals further.
