One Big Beautiful Bill Act (OBBBA) passed both houses of Congress by the thinnest of margins and was signed into law by President Trump last Thursday. It is the most significant legislation for U.S. healthcare since the Patient Protection and Affordable Care Act (ACA) signed into law by President Obama March 23, 2010.
The two laws are alike in many ways:
Both laws are responses to economic circumstances and the political leverage healthcare brings:
- The ACA passed on the heels of the 2009 American Recovery and Reconstruction Act recession as a means of turbo-charging “shovel ready jobs” and using expanded insurance coverage as a mechanism to support employer hiring. Healthcare is a job-sensitive industry: un-employment dropped from 10% to 4% with healthcare leading job growth
- The OBBBA comes six months into the Trump administration’s second term in which the domestic economy along with border security are keys. Healthcare affordability is an issue and polling shows the majority think the health system is wasteful. Thus, cuts to Medicaid as a means of reducing federal spending is opportunistic, especially since its primarily administered by states.
Both focus on a popular complaint about how the industry operates:
- The concern: coverage. The ACA focused primarily on expanded coverage via Medicaid and marketplaces enabling low-income citizens earning under 400% of the federal poverty level to qualify for free or subsidized coverage. It deemed coverage the primary failure of the system. The public agreed: the majority think healthcare is a right, not a privilege. Insurance coverage is a means toward equitable access, they think.
- The concern: waste. The OBBBA is premised on a belief among some that the federal government is inefficient and wasteful. Medicaid, which represents the majority of spending cuts in the OBBBA, is an attractive target, especially since states are its overseers and its expansion was
Both secured narrow majorities in Congress advancing their bills despite loud opposition from leading health industry trade groups–especially hospitals, drug companies and insurers that garnered the bulk of attention in both. Each of the three could deduce bad news & good news in the laws when passed:
| Bad news/good news | Hospitals | Insurers | Drug Companies |
| Affordable Care Act
2010 |
Increased use of value-based purchasing to reduce unnecessary utilization, heightened transparency about quality but no price controls, limits on consolidation or mandates re: charity care and increased revenues from insured enrolllemt. | Administrative cost limits, mandated preventive health requirements, suspension of pre-existing condition stipulations + annual fees but no constraints on insurer vertical integration, consolidation, premium pricing PLUS enrollment growth in marketplaces, Medicaid and Medicare Advantage. | Comparative effectiveness research launched, discounts to Medicare purchases allowed, + annual fees
but patent protections and industry pricing autonomy left unaffected |
| OBBBA
2025 |
Reduced payments by Medicaid (most harmful to independent rural hospitals, safety net hospitals, nursing homes and public health) but 340 B cutbacks not included & $50 billioon allocated to rural health | Reduced enrollment in Medicaid plans but PBM alternative | 340 limitations not included but most favored nation pricing not included |
It’s too soon to know what the results will be for OBBBA. Many fear it will cause irreparable damage to the safety net—public health programs, rural and safety net hospitals, nursing homes and others that serve lower-income and disabled populations. Some see it as a necessary reset asserting waste, fraud and abuse in healthcare has been allowed to fester, harming those in bona-fide need and keeping resources in healthcare better used elsewhere.
What’s known for sure is that opinions about the OBBBA will change as it’s implemented over the next four years. How states address work requirements and implementation will be central to its success. And executive orders, administrative actions, court decisions and market conditions will alter its trajectory—especially economic conditions at home.
Final thought:
In 2010, the health industry was acclimating to evidence-based medicine, value-based purchasing and interoperability thru the lens of a Democratic administration. Today, it’s foci are cybersecurity, self-care and Gen AI optimization through the lens of a GOP administration. The constants–concerns about quality, safety, accessibility and cost-effectiveness—haven’t changed. How they’re defined and valued by each administration has varied. For the OBBBA, it’s only the first inning. Stay tuned.
Paul
Quotables
Andrews on hospital pricing: “Besides being distinctly un-American, price caps don’t work, as articulated by Milton Friedman and demonstrated by the impact of President Nixon’s price controls in 1971 and New York City’s decades-long love affair with rent control, which are in stark contrast to deregulation of the transportation and energy markets. Although the Congressional Budget Office believes that price caps are the only thing that can bend the healthcare cost curve, U.S. economic history suggests that another solution – a true consumer market – might be superior to price caps.
Employers, however, don’t want any government-mandated solutions that force their employees to choose between a hospital that delivers above-average value for money in cardiology but below-average value for money in oncology and another that offers the opposite. In fact, employers don’t even want to provide health insurance, and many of them would gladly trade the tax benefit in exchange for being relieved of the numerous burdens of being the financier of and distribution mechanism for health insurance for half of the U.S. population.
Instead of even more government interference with and distortion of the largest sector of the U.S. economy, Congress should consider how a true consumer market – Americans using their own money to make their own choices about their healthcare, the most personal financial decision they make – could provide the transformation that America’s health economy desperately needs. And, Congress should also question the motives of every entity that would oppose such a transformational change.”
How Hospital Price Caps Confirm the Narrow Network Fallacy
Hyun on AMCs: “The corporatization of medicine has significantly altered health care delivery in the United States, challenging AMCs to redefine their role in an evolving system. If AMCs fail to adapt, they risk losing their influence in outpatient care and becoming increasingly disconnected from the communities they serve. By embracing physician-led community partnerships, innovative outpatient care models, and policy advocacy, AMCs can reclaim their leadership in health care delivery. This is not merely an institutional concern—it is a call to action to preserve the integrity of patient-centered, research-driven medicine. The future of academic medicine must extend beyond hospital walls and into the communities that need it most.
AMCs have the power—and the responsibility—to lead this transformation, but they cannot do so alone. Sustained policy oversight, transparency in ownership, and safeguards against financial exploitation are essential to ensure that academic medicine can compete—and thrive—amid an increasingly corporate and ethically contested landscape.”
From Ivory Towers To Main Street: Advancing Community Health In A Corporate Era | Health Affairs July 1, 2025
Pollack on Budget Bill:: “We are deeply disappointed by today’s vote in the United States Senate to advance the One Big Beautiful Bill Act (H.R. 1). The real-life consequences of these nearly $1 trillion in Medicaid cuts – the largest ever proposed by Congress – will result in irreparable harm to our health care system, reducing access to care for all Americans and severely undermining the ability of hospitals and health systems to care for our most vulnerable patients.
This legislation will cause 11.8 million Americans to be displaced from their health care coverage as they move from insured to uninsured status. It also will drive up uncompensated care for hospitals and health systems, which will affect their ability to serve all patients. It will force hospitals to make service line reductions and staff reductions, resulting in longer waiting times in emergency departments and for other essential services, and could ultimately lead to facility closures, especially in rural and underserved areas.
We urge the House to mitigate this legislation and protect access to health care for patients and communities. “
AHA Statement on Senate Passage of One Big Beautiful Bill Act | AHA
Buntin on Value-based care: “I think we’re at a very critical inflection point right now because a lot of the formal evaluations of value-based health care demonstrations, like those done by the Center for Medicare and Medicaid Innovation, have come to the conclusion that those demonstrations saved a few percent on health care spend. But I would argue that they were comparing them [with] a control group, if you will, that wasn’t a true control group, because this value zeitgeist has really permeated the whole health care system, the whole health care industry, for arguably about 20 years now. And so, the question is whether we’ll draw what I would argue is the wrong conclusion from these evaluations and think that value-based care wasn’t and isn’t important. If we do that and we pull back, then I think we will start to see health care spending growth increase. We know there are going to be price pressures because of all the forces going on in the world, which I don’t need to list, but whether we’ll be able to keep that focus on value and keep the innovation in the value-based care sector, that is, I think, what’s on the line. That is what maybe I should be calling, going forward, the $10 trillion question.”
Managed Care Reflections: A Q&A With Melinda B. Buntin, PhD
HealthEdge on Insurer Engagement with Members: “HealthEdge® recently released its fifth annual Healthcare Consumer Study, one of the most comprehensive consumer surveys in the health insurance industry. This year, more than 4,500 healthcare consumers shared their views, providing valuable insights for health plans as they navigate a rapidly evolving market. “ Highlights:
- The shift from ‘payers of claims’ to ‘partners in care’51% of healthcare consumers now view their health plan as a partner in care rather than just a payer of claims. Survey respondents who see their health plan as a partner report significantly higher satisfaction and loyalty.
- AI-powered experiences hold potential—but require member trust Only 21% of healthcare consumers surveyed reported using AI-powered tools provided by their health plans. Among those who had not used such tools or were unsure if they had used these tools before, 64% said they would be open to doing so.
- Member satisfaction and loyalty remain under pressure While 34% of healthcare consumers reported being extremely satisfied with their health plan, 27% said they are somewhat or very likely to switch plans in the coming year.
- Digital engagement expectations continue to rise The survey found that 78% of respondents have used or are likely to use their health plan’s mobile app, an increase from 64% in the 2024 HealthEdge Consumer Survey.
.Healthcare Consumers’ Rising Expectations: Four Key Themes from HealthEdge’s Fifth Annual Consumer S June 26, 2025
Madden on Nutex: “Something caught my eye the other day. My stock tracker flashed that Nutex Health, a $710M market cap, ~$1B enterprise value company in healthcare is up 300% on the year!…
In summary, Nutex Health’s current profitability masks serious underlying risks, including aggressive regulatory arbitrage, questionable financial reporting, and a potentially problematic physician ownership structure. History strongly indicates that these strategies are unlikely to be sustainable long-term, placing Nutex at significant risk of regulatory backlash or financial distress.
Within 5 years Nutex will look materially different than it does today, and this is a ticking time bomb predicated on the next iteration of a strategy that has proven – time and time again – to be unsustainable and a cash grab at best. History doesn’t repeat itself, but it often rhymes, and this thing stinks of predecessors like Cano, Adeptus, Envision, Steward, and plenty of other notable companies who have gone down similar paths. If looks too good to be true, it often is.
I happily invite anyone from Nutex to refute any of the above or provide additional context for anything I may have misrepresented.”
Blake Madden Nutex Health: Adeptus 2.0 or a legit micro hospital network strategy? Hospitallogy July 3, 2025
Economy
WSJ on June Jobs report: “U.S. job growth looked solid in June, but the headline number hides a stark reality: Many private employers aren’t hiring anymore.
Weighed down by high interest rates, a federal crackdown on immigration and uncertainty over tariffs, more companies are deciding they are better off with a smaller head count.
Last month, businesses added 74,000 new jobs, an anemic number compared with previous months. Private-sector job growth fell to the lowest level since October 2024. Of the 147,000 total new jobs added in June, nearly half were in government, bolstered by a jump in state and local government jobs.
On top of that, more than half of private industries cut jobs in June, Labor Department data indicates—only the third time this has happened since April 2020. For most of the postpandemic period, the majority of industries were adding jobs.
While private employers still added jobs overall in June, the gains were smaller than in prior months and heavily concentrated in a handful of sectors. Healthcare and social assistance, leisure and hospitality and construction companies added 94,000 jobs in June, but they account for just 36% of all private, nonfarm employment. The remaining sectors, which include professional and business services, manufacturing and wholesale trade, among others, and account for almost two-thirds of private employment, cut 20,000 jobs in aggregate. “
American Companies Had Lowest Job Growth in Eight Months – WSJ
Prescription drugs
GLP-1 Drug by Age Group, 2019-2024: % Prescriptions
| Age Group | 2019 | 2024 | Percent Change |
| 18-39 | 0.19% | 1.33% | 587.8% |
| 40-64 | 1.20% | 5.41% | 350.7% |
| 65+ | 1.25% | 5.10% | 309.6% |
FAIR Health White Paper, Obesity and GLP-1 Drugs: A Claims-Based Analysis, May 2025
