CNC · 10-Q · 2026Q1 · Full report
Medicaid policy changes
CENTENE CORP · 2026-04-28 · Importance 65 · Surprise 60
The One Big Beautiful Bill Act (OBBBA), passed in July 2025, includes requirements that may reduce Medicaid Expansion eligibility by requiring work or community engagement and more frequent eligibility redeterminations, and it adds a “Cost Sharing” or “Co‑Pay” for certain services. The OBBBA may increase overall morbidity of the Medicaid Expansion population largely beginning in 2027, subject to state implementation plans, and contains provisions (beginning in 2028) that could reduce federal funding through adjustments to provider taxes and state directed payments. The OBBBA also includes a restriction against paying certain providers designated as “prohibited entities” as of October 1, 2025, which the company warns could create access to care issues and network gaps. Centene states timing of regulatory guidance and rulemaking will be critical to state and MCO implementation readiness and that it is working with states to match rates to acuity post‑redeterminations.
Key facts
- New York will terminate its Essential Plan-5 by July 1, 2026, which provided state-subsidized healthcare for individuals from 200% to 250% of the FPL.
- The OBBBA was passed in July 2025 and includes requirements that may reduce Medicaid Expansion eligibility by requiring work or community engagement and more frequent eligibility redeterminations beginning in 2027, and adds 'Cost Sharing' or 'Co-Pay' for certain services.
- The OBBBA includes adjustments to provider taxes and state directed payments beginning in 2028 that may reduce federal funding for Medicaid.
- OBBBA includes a restriction against paying certain providers designated as 'prohibited entities' as of October 1, 2025.
- Centene expects the OBBBA changes could increase overall morbidity of the Medicaid Expansion population largely beginning in 2027 subject to state implementation.
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| revenue | negative | probable | — | New York will terminate its Essential Plan-5 by July 1, 2026, which provided state-subsidized healthcare for individuals from 200% to 250%… |
| revenue | negative | contingent | — | The OBBBA was passed in July 2025 and includes requirements that may reduce Medicaid Expansion eligibility by requiring work or community… |
| revenue | negative | contingent | — | The OBBBA includes adjustments to provider taxes and state directed payments beginning in 2028 that may reduce federal funding for Medicaid. |
| revenue | negative | contingent | — | OBBBA includes a restriction against paying certain providers designated as 'prohibited entities' as of October 1, 2025. |
| operating_income | negative | contingent | — | Centene expects the OBBBA changes could increase overall morbidity of the Medicaid Expansion population largely beginning in 2027 subject… |