As the summer of 2025 draws to a close, a sweeping new federal law is sending shockwaves through state legislatures and communities across the country. Signed by President Donald Trump on Independence Day, the nearly 1,000-page bill—dubbed the One Big Beautiful Bill Act—has become a lightning rod for debate over the future of America’s social safety net, state budgets, and the nation’s political direction.
At the heart of the controversy are deep cuts to health care and food assistance programs, including Medicaid and the Supplemental Nutrition Assistance Program (SNAP), which have long provided a lifeline to millions of Americans. According to Stateline, Oklahoma state Sen. John Haste described the fiscal impacts as “a really big number,” noting that the law slashes $209 million from funds that help Oklahoma cover Medicaid costs and requires an estimated $30 million in new spending just to check eligibility twice per year. “Number one was tax cuts. Number two, what the hell is going on in Washington?” Haste quipped during the National Conference of State Legislatures summit in Boston—a gathering of over 1,600 state lawmakers grappling with the law’s implications.
The legislation’s effects aren’t limited to Oklahoma. In Nevada, Democratic state Sen. Fabian Doñate warned that leaders would soon face impossible choices, given that Republican Gov. Joe Lombardo opposes any tax increases. “Do you cut the pregnant mom or the person that makes above 180% of the federal poverty level who’s under 50, or do you cut diapers for seniors?” Doñate asked pointedly during a panel discussion on Medicaid.
One of the most contentious provisions requires the 40 states (plus Washington, D.C.) that expanded Medicaid to check paperwork at least twice a year, ensuring enrollees meet new work requirements by the end of 2026. While the law allocates $200 million to help states implement these changes, experts like Lauren Kallins, senior legislative director for state-federal affairs at the National Conference of State Legislatures (NCSL), question whether it will be nearly enough. “Regardless of how you feel about these provisions—whether these are opportunities or challenges, fantastic or awful—regardless, it’s going to be a heavy lift for states,” Kallins said. States will need to ramp up outreach to Medicaid recipients and invest in new technology, all while racing against the clock.
SNAP, or food stamps, is also facing a major shakeup. Traditionally, the federal government has shouldered the full cost of SNAP benefits and split administrative costs with states. Now, states must cover 75% of administrative costs and, depending on their accuracy in determining eligibility, may be required to fund a portion of the benefits themselves. “That’s another very significant increase for states,” Kallins added.
Despite these challenges, many states currently boast strong fiscal positions and deep reserves. Utah’s legislative fiscal analyst Jonathan Ball told conference attendees that the state could dip into its reserves to cover some of the new administrative and technical costs. “It’s a little bit maybe scarier, but it’s not a new sort of problem,” Ball said. “We feel like we have the tools to fix it.” Yet, he cautioned that the uncertainty surrounding future federal funding cuts is “huge.”
Financial analyst Geoffrey Buswick, managing director at S&P Global Ratings, echoed this cautious optimism, noting that most states enjoy enviable credit ratings and budgetary cushions. “The states are in a very, very strong position—about the strongest we’ve ever seen,” Buswick said.
But not everyone is convinced that reserves will be enough. Maryland Democratic state Sen. Karen Lewis Young pointed out that her state faces a sharp decline in federal jobs and cuts to transportation, health, and education funding. “You’ve got to cut from someplace else,” she said. “If you’re losing a pretty large share of your federal match, who do you cut?”
Hawaii, despite socking away more than $1 billion in reserves, is also feeling the strain. State Senate President Ronald Kouchi warned that the state cannot possibly fill all the financial gaps left by federal cuts, especially as it tries to increase disaster funding and cope with a slowdown in tourism. “There is no current financial ability for the state to meet the needs of everyone who is currently being impacted,” Kouchi said in an interview with Stateline.
In New Mexico, Rep. Meredith Dixon said the state’s Medicaid Trust Fund—created from surplus oil and gas revenues—offers some insulation, but it’s still unclear how much pressure the federal legislation will exert. “We are not protected by any stretch. So we are going to have to look at how we cover those costs. … We’re still digging into everything.”
West Virginia House Speaker Roger Hanshaw, a Republican, likened the process to “Obamacare 2.0: We have to pass this bill so we can find out what’s in it.” While some provisions may benefit his state, others are sure to cause a “substantial headache.” “We have no idea yet how we’re going to respond,” Hanshaw admitted. “I would speculate that’s true for nearly every other state.”
Outside the halls of government, the law is fueling grassroots activism and public protest. On August 15, about a dozen demonstrators gathered outside U.S. Rep. French Hill’s home in Little Rock, Arkansas, waving signs and delivering a letter that condemned his vote for the One Big Beautiful Bill Act. Norma Huffman, president of Arkansas Community Organizations’ Southwest Little Rock chapter, said the cuts to Medicaid and SNAP have already made life harder for Arkansans. “Americans are going to suffer if this stuff keeps going on,” Huffman said, according to the Arkansas Democrat-Gazette. Protesters urged Hill to oppose further cuts to housing and public education when Congress reconvenes in September, emphasizing in their letter, “We need to increase funding for HUD. Public education is the only education that most of our families can afford.”
For many, the practical effects of the law are already being felt. Huffman described how food stamp recipients face higher prices when shopping online and struggle with transportation barriers. The group plans to travel to Washington, D.C., in September to join national protests organized by Popular Democracy, potentially engaging in civil disobedience to draw attention to their cause.
The backlash isn’t limited to Arkansas. In Iowa, Holly Oppelt, president of the League of Women Voters of Iowa, penned a letter to The Gazette decrying the bill’s passage. “The law makes massive cuts to vital services including Medicaid and the Supplemental Nutrition Assistance Program (SNAP, formerly food stamps),” Oppelt wrote. “It will make it harder for children, parents, pregnant people, seniors, and people with disabilities to enroll in and keep the benefits they need to survive.” Citing estimates that 11.8 million people could be left uninsured by 2034, Oppelt called for a movement of nonviolent action to protect and restore democracy, urging readers to visit lwv.org/uniteandrise to get involved.
With Congress set to reconvene in September and states still scrambling to assess and respond to the new law’s demands, the coming months could prove decisive for millions of Americans who rely on the programs now under threat. The stakes are high, and the debates—both in statehouses and on the streets—show no sign of abating.
