What the “One Big Beautiful Bill” Could Mean for Your Practice’s Bottom Line

As the One Big Beautiful Bill Act (H.R. 1) advances through Congress, it is creating serious concerns across the healthcare industry – especially for providers dependent on Medicaid and Medicare reimbursement.

At Fedora Healthcare Solutions, we are tracking every turn of this legislation because the potential impacts on revenue cycle performance are likely to be significant. If your practice relies on Medicaid, Medicare, or Marketplace-covered patients, this bill has the potential to change your financial trajectory in just a few budget cycles. As with any risk, it can be managed with proper planning and by working with the right partner. In this article we will review some of the more challenging aspects of the potential impacts of this legislation on independent practices across the U.S., with an eye towards what we can do about them now and into the future.

1. Medicaid Reimbursement Faces Steep Cuts

The bill proposes strict new limits on State-Directed Payments (SDPs) – a funding mechanism many states use to enhance Medicaid payments. In the coming years, these payments would be capped at 100–110% of Medicare, with a phase down that could shrink revenue for hospitals and providers in over 30 states.

Additional changes:

• Work requirements and stricter eligibility rules are predicted to push millions off the Medicaid rolls

• A freeze on provider taxes, cutting off a key financing tool for states

• Tighter DSH payment caps, even as charity care demand increases

While a one-time $25 billion rural hospital fund offers limited relief while tacitly acknowledging the overall impact of these reductions on rural healthcare access, the overall trend is clear: we should expect lower Medicaid rates and more uninsured patients.

2. Medicare Physician Fee Schedule: Short-Term Patch, Long-Term Risk

Although the bill originally proposed linking Medicare payments to the Medical Economic Index (MEI). which was meant to provide long-term stability, the current Senate draft removes that fix.

Here’s what remains:

• A temporary 1.25% payment increase in 2026

• The scheduled –3.37% cut resumes in 2027 unless future legislation intervenes

3. Shifts in Coverage and Payer Mix

The bill would let ACA subsidies expire after 2025, shorten open enrollment, and eliminate automatic reenrollment. The Congressional Budget Office projects that up to 16 million people could lose coverage – driving a shift toward self-pay patients and higher bad debt exposure for providers.

4. What Independent Practices Should Be Doing Now

If you’re running an independent medical practice, especially a smaller one, these changes could have a very real impact on your daily operations—especially if a large portion of your patients are covered by Medicaid, Medicare, or ACA plans.

Here’s what we recommend focusing on:

• Review your current payer mix. Understand how many of your patients rely on Medicaid, Medicare, or ACA Marketplace plans so you can estimate where revenue might be affected.

• Tighten up insurance verification and eligibility workflows. With more churn expected in Medicaid and ACA coverage, front-end accuracy will be essential to avoid denied claims.

• Track patient balances more closely. As coverage declines and out-of-pocket costs rise, clear communication and proactive follow-up on patient responsibility will be key to maintaining cash flow.

• Monitor claim denials and underpayments. Even small changes in policy can cause reimbursement gaps—especially with state Medicaid programs. Make sure your billing team is catching and appealing what’s owed.

• Ask for help when you need it. You don’t need an in-house analytics team to stay ahead of this. With the right partner, you can get the insight and support to respond quickly and stay financially stable.

Your Partner in Navigating Uncertainty

We know independent practices face unique challenges and tighter margins. At Fedora Healthcare Solutions, we specialize in helping community-based providers optimize their revenue cycle, improve collections, and prepare for change. Our experts understand the nuances of nearly every specialty and know how to optimize revenue cycle processes regardless of the complexity of your practice – from single providers to the largest multi-specialty centers. Working with a team that can “see over the horizon” in situations such as this will support the business-aspects of your practice allowing you to keep your focus where it should be – on providing the care your patients and their families need.