Rural areas, southern states will bear the brunt

The budget reconciliation bill currently making its way through the Senate will disproportionately hurt the nation’s children by cutting the programs that benefit them most, experts said today on Capitol Hill.

“We keep hearing this rhetoric that none of the bill targets kids, that these changes do not hurt kids. That’s impossible,” said First Focus on Children health policy expert Abuko Estrada at “Invest in Kids,” a briefing hosted by First Focus on Children, the Congressional Dads Caucus and the Congressional Mamas’ Caucus. “You can’t take a third of the funding for a program that mainly serves kids and say it doesn’t hurt kids.”

The budget proposal passed by the House of Representatives would cut more than $800 billion from Medicaid and the Children’s Health Insurance Program (CHIP) and would cut nearly $300 billion from the Supplemental Nutrition Assistance Program (SNAP). The Senate is likely to maintain many of these cuts, panelists said.

Federal spending on children accounts for just 8.87% of the total U.S. budget, according to Children’s Budget 2024, although children make up 23% of the population. But the programs Congress has targeted disproportionately serve children: 20% of Medicaid funding goes to children, 43% of SNAP funding goes to children, and of course, 100% of CHIP funding goes to children and pregnant women. Cuts to these programs will almost certainly push the share of spending on children much lower. During the first Trump Administration, the president proposed reducing this share to a record low of 7.32%.

The budget bill under consideration in the Senate would significantly alter Medicaid and CHIP, jeopardizing health care access for over 37 million children, by including waiting periods, lock outs for parents who can’t keep up with premiums, and caps on annual and lifetime benefits. The package also would reduce the federal matching rate for adults in Medicaid expansion states to 80% if the state provides health care benefits to residents who are ineligible because of their immigration status — even if the states are using money from their own taxpayers.

“We are resurrecting barriers for children,” First Focus on Children’s Estrada said.

The bill also threatens the food security of at least 4 million children who live in households that could lose their benefits as a result of increased work requirements. The bill would also shift hundreds of millions of dollars in program and benefit costs to the states, said Salaam Bhatti, SNAP director at the Food Research and Action Center (FRAC), and revise the formula that determines benefits in a way that reduces the amount.

“If states cannot afford these cost shifts, they will pull out of the program,” Bhatti said. “Food insecurity has increased three years in a row. And the one program that fights hunger is getting cut. It doesn’t make any sense.”

Panelists also criticized the bill’s Child Tax Credit provision. Supporters focus on the increased amount of the credit — from $2000 per child to a maximum of $2500 per child — but other changes would deny the full credit to an additional 5 million children. Rural areas and states in the South would be hardest hit.

“These changes are not centered on children and families,” said Michelle Dallafior, First Focus on Children senior vice president for budget and tax. “And they do not help children most in need.”

To view the recorded briefing, visit Children’s Week 2025-Invest in Kids Briefing. 

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Meanwhile, we’ve gathered members of Congress and fellow advocates to celebrate Children’s Week 2025, which starts Sunday and runs through Saturday, June 14. The week will feature a series of briefings and events with lawmakers, advocates, and academics on subjects including the metrics of early education, investing in foreign assistance for children, and the threats to children contained in the reconciliation package making its way through Congress. Events include:

MONDAY, June 9 | Welcome Reception

Monday, June 9, 5:30 pm ET

Join First Focus on Children, members of Congress and other advocates for food and drink to celebrate the kick-off to Children’s Week. Register here.

TUESDAY, June 10 | Why Foreign Assistance Matters for Children

Tuesday, June 10, 12:00 pm ET, VIRTUAL

As Congress considers critical decisions on the FY 26 appropriations, join us for a timely and urgent webinar exploring the real-world consequences of foreign assistance cuts on children across the globe. Hosted in conjunction with Georgetown University Collaborative on Global Children’s Issues. Register here.

WEDNESDAY, June 11 | Invest in Children Briefing

Wednesday, June 11, 10:00 am ET

Join First Focus Campaign for Children and the Congressional Dads Caucus for a briefing on the ways the budget reconciliation package puts the health, nutrition, economic security, and education of children at risk. Register here.

THURSDAY, June 12 | Early Gains, Lifelong Returns – What the Early Childhood Research Shows

Thursday, June 12, 12:00 pm ET

Join First Focus on Children and policy advocates for a briefing demonstrating the effectiveness and strong return on investment of federal early childhood programs. Rep. Suzanne Bonamici (D-OR) is scheduled to provide opening remarks. Register here.

For a full list of events, please visit our registration page: https://firstfocus.org/childrens-week-2025/.

The post The Kid Angle: Briefings Spotlight Challenges to Children appeared first on First Focus on Children.

While many of the bill’s supporters claim that children and other vulnerable populations will not be harmed by the changes made in reconciliation, this is just not true. It is impossible to achieve the level of funding cuts set forth in the bill without causing direct and indirect impacts to the health and well-being of children and families. 

The House reconciliation bill singles out programs that disproportionately benefit children for cuts. Only 8.87% of total federal spending goes to kids, but the programs targeted by the bill devote a much larger share to children. For example, 20% of Medicaid funding goes to children, 100% of the funding in the Children’s Health Insurance Program (CHIP) goes to children and pregnant women, and 43% of SNAP dollars go to families with children. These three programs rank among the top 10 largest federal investments in children and are targeted for more than $1 trillion in cuts. 

These programs work alongside one another to support our nation’s kids. Any of the individual cuts included in this bill would be considered a loss for children, and when taken together, this bill is a disaster for kids. For example, 14 million children depend on both Medicaid and SNAP. This “double jeopardy” risks their access to both food and health insurance. In addition, enrollment in certain benefit programs makes it easier for children to receive other supports. For instance, SNAP recipients automatically qualify for free school meals and child care subsidies. If children are not enrolled in SNAP or Medicaid, they are also likely to experience reduced participation in these other programs that qualify for automatic eligibility. 

Medicaid, SNAP, and tax policy are essential to keeping kids fed, healthy, and cared for. As the House bill moves to the Senate, Congress still has an opportunity to choose babies over billionaires. First Focus Campaign for Children calls on lawmakers to protect children by stopping this bill. 

Child Health

Every child deserves a healthy start and the opportunity to thrive, but policies that undermine access to essential health care put the well-being, development, and future of millions of children at risk. The proposed budget reconciliation bill includes several provisions that would significantly alter Medicaid and CHIP, jeopardizing health care access for over 37 million children who rely on the programs. 

Moratorium on Rule that Simplifies Enrollment and Eligibility

The House bill would place a moratorium on the Centers for Medicare & Medicaid Services’ (CMS) “Streamlining Medicaid, CHIP, and Basic Health Program Application, Eligibility Determination, Enrollment, and Renewal Processes” rule, which was designed to reduce red tape and make it easier for eligible children to enroll and stay enrolled in Medicaid and CHIP. The rule also included important protections for CHIP by prohibiting states from imposing:

• Waiting periods: This is an outdated mechanism imposed on children after they voluntarily disenroll from a group health insurance plan, such as a parent’s employer-sponsored plan. When CHIP was established in 1997, states were required to make sure that CHIP did not substitute for group health insurance. One method that states used was to impose a period of time a child must remain uninsured before enrolling in CHIP. Many states ended waiting periods after the Affordable Care Act limited them to 90 days. However, as of February 2024, nine states still required children to remain uninsured for a period of time before they could sign on to CHIP. The final rule helped to ensure that no child eligible for CHIP will be forced to go without coverage, preventing critical gaps in their health care.

• Lock-out periods: Under the final rule, states are prohibited from imposing mandatory “lock-out” periods on children whose families cannot keep up with their state’s CHIP premium payments. Prior to the final rule, a dozen states used these lock-out periods to keep children from re-enrolling in CHIP for a certain period of time after they lost coverage due to non-payment of premiums. The child could be forced to go without coverage until the end of the lock-out period, even when the family could afford to pay the overdue premiums.

• Annual/Lifetime Benefit Caps: States have several options for how they implement CHIP. States can choose 1) to expand Medicaid coverage for children (funded with CHIP dollars; a.k.a M-CHIP); 2) design a separate CHIP; or 3) use a combination approach. Most states use a combination approach. For kids enrolled in M-CHIP, a state must follow Medicaid rules. For separate CHIPs, states have greater flexibility in designing benefit packages, a policy that has led some states to limit certain benefits and services, such as dental and mental health care, including imposing annual and lifetime caps. Medicaid does not allow annual or lifetime limits, and the Affordable Care Act extended these protections to other populations. The final rule meant that states could no longer impose these limits on specific benefits that children who are enrolled in separate CHIPs need.

Reducing Retroactive Coverage

Retroactive Medicaid coverage allows medical bills incurred up to 90 days before application approval to be covered. The House bill would reduce this vital coverage from 90 days to 30 days. Retroactive coverage is crucial for newborns, children with sudden illnesses, and families facing emergencies, ensuring they are not left with unaffordable medical debt while their application is processed. Without this protection, families will be forced to delay or forgo crucial medical care for their children due to cost concerns, leading to preventable hospitalizations and worsening chronic conditions.

Penalizing States that Provide Coverage to Immigrants

The reconciliation package would penalize the federal matching rate (FMAP) for adults in Medicaid expansion states, reducing it from 90% to 80%, if the state provides financial assistance or “comprehensive health benefits” to residents ineligible for Medicaid due to immigration status. Currently, 14 states and the District of Columbia have chosen to use state dollars (not federal Medicaid funds) to extend some form of comprehensive health coverage to all children, regardless of immigration status. Two states also provide coverage to pregnant women regardless of immigration status.

This penalty effectively doubles the state’s cost of maintaining Medicaid expansion and also represents an unprecedented federal intrusion into state policy decisions about how to use state-only funds. This provision will force states to choose between maintaining coverage for immigrants, disproportionately children and pregnant women, and preserving federal Medicaid expansion funding. The provision would likely result in thousands of immigrant children losing access to preventive care, chronic disease management, and treatment for acute conditions. This loss of coverage could lead to worsened health outcomes, increased emergency department utilization, and higher long-term health care costs for families and the communities in which they live.

Moratorium on Provider Taxes

A provision to limit states’ flexibility to finance their Medicaid programs through provider taxes would have far-reaching consequences for pediatric care. These taxes on hospitals and other health care providers generate revenue that helps states support their Medicaid programs. Restricting state ability to use this financing mechanism would:

• Force cuts to services, eligibility, or provider payments that directly affect children.
• Create significant financial pressure on children’s hospitals and pediatric specialty providers that depend heavily on Medicaid.
• Threaten school-based health services that rely on support from Medicaid.
• Jeopardize mental health and developmental services for children, which are often financially vulnerable.
• Hit hardest in states with limited tax bases that rely on provider taxes to maintain their programs.

Children’s hospitals, community clinics, and pediatric specialists often operate on thin margins while serving a high proportion of Medicaid patients. Financial instability in these critical institutions would have immediate consequences for children’s access to care, including specialty care, particularly in underserved areas.

Banning Use of Federal Dollars for Gender-Affirming Care

The budget reconciliation bill includes a provision that would prohibit use of federal Medicaid/CHIP funding for gender affirming care for all individuals, including children and youth. This legislative move would have significant negative consequences for the health and well-being of transgender and gender-diverse youth.

Banning federal funding for gender affirming care means that transgender youth in families with low-incomes would lose access to guideline-directed, medically necessary health care interventions. These interventions may include puberty blockers, hormone therapy, and related mental health services, which are recognized by major medical organizations as critical components of care for gender dysphoria in youth. Without coverage, many families would be unable to afford these treatments out-of-pocket.

Research consistently shows that access to gender affirming care is associated with improved mental health, reduced rates of depression and anxiety, and lower risk of suicide among transgender youth. Denying this care can lead to increased psychological distress, feelings of rejection, and a higher incidence of self-harm and suicide attempts. 

Work Requirements

The House bill would require certain adults on Medicaid to work or participate in work-related activities for at least 80 hours per month, with some exemptions for parents and caregivers of small children. Despite these exemptions, imposing work requirements on Medicaid poses significant risks to children’s health. When parents or other adults in a child’s household lose Medicaid coverage due to work requirements — often because of complex paperwork or administrative hurdles — children are less likely to receive the care they need. This is because children’s health and development are closely tied to the health and stability of their parents and caregivers. Loss of coverage for adults can lead to increased family stress, reduced access to health care, and greater financial hardship, all of which negatively affect children’s well-being and development.

Additionally, work requirements create more bureaucratic barriers for families, leading to eligible children losing coverage due to missed paperwork or confusing processes. Past experience, such as in Arkansas, showed that thousands lost coverage for procedural reasons, not because they were actually ineligible. When children lose Medicaid, they lose access to essential services — including preventive care, mental health, and developmental screenings — that are critical for healthy growth, especially for those with special health needs.

Affordable Care Act Marketplace 

More than 2 million children are currently enrolled in Marketplace plans. The reconciliation package includes revisions to Marketplace policies, including special enrollment periods, income verification, auto re-enrollment, and other items that will increase costs for Marketplace enrollees or make it harder to stay covered, which will lead to more uninsured individuals, including children. 

A last-minute change to the House bill will provide funding for special payments called cost-sharing reductions (CSRs), which help lower out-of-pocket costs like deductibles and copays for people with low incomes who buy what are known as Silver plans in the Marketplace. In the past, the government stopped paying these CSRs, but insurers still had to offer the reductions, so they raised the prices of Silver plans to make up the difference—a move known as “Silver Loading.” This actually helped some families get more financial help to pay their premiums for other types of Marketplace plans (e.g., Bronze or Gold). Now that the government will start paying CSRs again, insurers won’t need to “Silver Load,” but this change will have the consequence of raising health insurance premiums for families insured through the Marketplace, making it harder for them to afford coverage and possibly leaving them uninsured.

Potentially even more impactful on Marketplace coverage is what the reconciliation bill fails to do. Under the Affordable Care Act, individuals and families can receive advance premium tax credits (APTCs), based on their income, to help lower their monthly premium cost for purchasing a plan on the Marketplace. The American Rescue Plan Act (ARPA) made “enhancements” to the APTCs, providing even more assistance to lower the cost of premiums. The House bill fails to extend the enhanced APTC levels, which expire at the end of 2025. While the base level of APTCs remain in statute, the additional assistance provided under ARPA significantly improved costs for families enrolling in Marketplace coverage, helping millions more individuals, including children, becoming insured. Since 2020, enrollment in the Marketplace more than doubled from 11 million individuals to over 24 million in 2025. By allowing the enhanced level of APTCs to expire, the Congressional Budget Office estimates that over 4 million people will lose their health insurance.

Nutrition

As the nation’s largest federal food assistance program, the Supplemental Nutrition Assistance Program (SNAP) is the first line of defense against hunger and food insecurity for low-income children. More than 15 million children — representing close to 40% of the program’s participants — rely on SNAP for consistent, healthy meals. In 2023, SNAP lifted more than 1.3 million children out of poverty, and countless studies show that SNAP participation improves food security, health, educational, and long-term economic outcomes for children. First Focus Campaign for Children is deeply concerned that the changes contained in the budget reconciliation bill will increase the number of children who experience hunger or food insecurity. 

Transfer of Cost to States

The federal government has historically fully funded the food benefit costs of SNAP. In this bill, Congress backs away from that commitment and mandates that states cover at least 5% of the food benefit cost. While 5% may seem like a low percentage, this translates to billions of dollars for some states. Moreover, states could be required to pay much more than 5%, with Congress proposing increased responsibility to states based on error rates within the program. In some instances, this provision could lead to states being responsible for up to 25% of the cost. Because error rates are calculated annually, states could fall into different categories of funding responsibility from year-to-year. In addition to the food benefit cost transfer, the budget reconciliation bill also restructures the funding balance so that states will be responsible for 75% of the administrative costs. Currently, the federal and state governments share administrative costs 50%-50%. 

These cost transfers place many states in an unfeasible position. The potential variability of a state’s cost share also makes it extremely difficult for states to plan for program continuation or prepare budgets for future years. Analysts anticipate that, if confirmed, these transfers will force states to reduce benefits, limit eligibility, or, in some cases, even end their SNAP programs. These pressures would lead to a reality where the government assists hungry children in some states and leaves them behind in others. 

Work Requirements

Currently, SNAP exempts households with children from work requirements. The House bill would exempt only families with children under the age of 7. Proponents of the provision reason that children over the age of 7 are in school during the day, allowing guardians to work. This change shows a complete misunderstanding of school schedules, ignoring summer and seasonal breaks and the fact that the hours of a school day are shorter than conventional work hours. It also represents a disregard for the costs and challenges of finding after-school child care. But most concerning, this provision communicates a willingness to risk the health and well-being of children over the age of 7. Adults who care for dependent children with disabilities also are not exempt from work requirements under this bill. Work requirements in SNAP are especially dangerous as they reduce the household’s overall benefits leading to less money for groceries and ultimately diminishing the amount of food the household has for children. Estimates place at least 4 million children living in households at risk of losing some or all of their benefits as a result of the new work requirements. 

Thrifty Food Plan 

The Thrifty Food Plan is the national standard by which the government determines the cost of buying food to maintain a healthy diet and subsequently sets SNAP benefit amounts based on that calculation. The plan was adjusted by the Department of Agriculture (USDA) in 2021 to modernize the standards and take into account the latest nutritional guidelines and food prices. This evaluation led to a slight benefit increase for SNAP recipients, with most households receiving an increase of $12-14 a month. The 2021 adjustment is credited with lifting 1 million children out of poverty. The House budget reconciliation bill would cancel future benefit adjustments, jeopardizing families’ ability to afford the basic necessities and components of a healthy diet. As grocery prices continue to rise, Congress should be taking steps to protect SNAP users from this fluctuation, not jeopardizing child nutrition further by ending future adjustments. 

Cascading Effect onto School Meals

Although the budget reconciliation bill does not specifically mention school meals, its provisions will directly impact the way schools address child hunger. Children who participate in SNAP currently are automatically enrolled in free school meals. If states are forced to limit the number of children covered by SNAP, students could lose their enrollment in free school meals due to administrative burdens, even if they are still qualified. In addition, fewer schools are expected to participate in the Community Eligibility Provision (CEP), which allows them to provide free school meals to the entire student body, if states have to limit their SNAP participation. The two programs are intertwined, with CEP reimbursement rates linked to the percentage of students that a school has enrolled in SNAP. Children cannot afford to lose the nutrition support they receive through schools at any time, but to not have safeguards for school meal enrollment at a time when SNAP cuts are endangering food at home is especially cruel. 

Economic Security

The tax code offers one of the most powerful tools for improving the lives of children, with the Child Tax Credit (CTC) and the Earned Income Tax Credit (EITC) among the top 10 programs contributing to federal investments in kids. In 2023, the CTC and EITC combined lifted 3.4 million children out of poverty. That number would have been even greater — as high as 7 million children — if lawmakers had renewed the historic 2021 improvements to the CTC, according to Columbia University’s Center on Poverty and Social Policy. 

The House reconciliation bill goes in the opposite direction. The bill would make permanent tax cuts benefiting the ultra- wealthy, including a boost to the estate tax exemption and the increase in the business passthrough deduction while also extending the weakened alternative minimum tax. The measure also would revive a trio of business deductions and together all these tax policies account for over 60% of the measure’s overall $3.8 trillion estimate of lost revenue through 2025-2034.

The tax provisions in the reconciliation bill represent a massive giveaway to the richest Americans. Under the bill, in 2026, the bottom 20% of earners (annual income below $27,000) would receive only 1% of tax savings (about $140) while the top 1% of earners (annual income above $900,000) would receive 21% of the tax breaks, amounting to an average tax break of nearly $70,000. The fact that the wealthiest will get permanent tax cuts while families with the lowest incomes will have their taxes increase over time — and will lose access to basic needs programs — threatens the future of millions of kids.

In addition, although the CTC maximum is increased from $2,000 to $2,500, the reconciliation bill simultaneously leaves behind 20 million children whose parents make too little to qualify for the full CTC. It also disqualifies 4.5 million U.S. citizen babies and children because their parents don’t have a Social Security number. Millions of other children will be hurt by changes to the EITC. Despite an overwhelming body of literature documenting that expanding the CTC is one of the best ways to help families with rising costs, this bill sharply limits who can access the credit and how much of it they can claim. 

A more unequal CTC

This budget bill prevents 20 million of the nation’s poorest kids from receiving the full credit — 2.5 million more low-income kids than previously. Right now, 17 million kids — one-in-four — are excluded from the full $2,000 CTC because their family income is too low. Instead of righting this wrong, the reconciliation provisions would increase the maximum CTC from $2,000 to $2,500 but leave in place the inequitable cap on the credit’s refundable portion. Meanwhile, families earning up to $400,000 would qualify for a larger credit. This change will widen the gap between families who are well-off and those who are struggling to provide basic, everyday needs for their children.

Children who will be disproportionately “left behind” by this bill are: babies and toddlers; children in larger families; rural children; children of color; and children in single-parent households. The bill punishes babies and mothers who lose income with a reduced credit when mothers earnings decrease during pregnancy, childbirth, and postpartum, when a child and family are vicitms of a natural disaster, when a child loses a parent due to death, when a parent reduces work to provide caregiving, or when a parent loses a job. For children and families who need the CTC the most, they get the least.

The CTC proposal also strips eligibility from 4.5 million American children because they live in households with mixed immigration status.. The poverty rate among U.S. citizen children in mixed-status families is 31.5% — more than three times that of citizen children in households where all members are citizens. The 2017 Tax Cuts and Jobs Act (TCJA), passed during the first Trump Administration, began denying the CTC to 1 million kids who did not have Social Security numbers.. Under the proposed tax provisions currently being considered, an additional 4.5 million kids, who have social security numbers, are US citizens or lawful permanent residents, and live with a parent without a social security number, would lose access to the credit, forcing many low-income families into, or deeper into, poverty. 

Hurdles to the EITC

The reconciliation bill also erects hurdles to the EITC, which has a long history of bipartisan support and a proven track record of lifting up working families. Research shows that families mostly use the credit to pay for basic needs such as groceries, rent, clothing, and school supplies. In 2023, the EITC kept 4 million people out of poverty as the poverty rate for children jumped to nearly 10 million from 3.8 million in 2021. Evidence has shown that the credit also produces significant lifetime benefits, such as better education outcomes, improved health, and higher lifetime earnings and a more secure retirement. 

Barriers to credit for health care premiums 

The Advance Premium Tax Credit (APTC) is a refundable tax credit available to families purchasing health care through the Affordable Care Act’s health insurance Marketplace, helping lower their monthly premium costs. In 2024, consumers eligible for a tax credit experienced an average yearly premium savings of approximately $700 due to enhanced premium tax credits, yet lawmakers did not extend them in the bill. A record 93% of Marketplace enrollees, or 19.3 million people, receive APTCs. Failure to renew this enhanced tax credit will raise health care costs for many families with children.

Education

Lawmakers have included in the reconciliation bill a version of the “Educational Choice for Children Act,” which would create a federal private school voucher program. School vouchers hurt students and schools by diverting public funds to private schools, discriminating freely against students, and not improving academic outcomes. School voucher programs are disproportionately harmful for students with disabilities. Voters continue to oppose private school voucher schemes: Every time one has come up for a vote, Republican, Democratic, and Independent voters have soundly rejected them.

While legislators claim vouchers help kids, they actually just benefit the wealthy. The bill provides an opportunity to avoid capital gains taxes by allowing donations of “marketable securities.” This provision would allow individuals to donate their appreciated corporate stocks and avoid paying capital gains tax on the appreciation, while also receiving a federal tax credit for the full market value of the donation. According to the Institute on Taxation and Economic Policy, this provision could lead to a “120 percent match or more for upper-income families” and disproportionately benefit wealthy Americans, while decreasing funding in state and federal budgets. In addition to the lost capital gains revenue, this would spend $5 billion a year in taxpayer funds, totaling $20 billion over a four-year period.

Environment

The reconciliation bill would claw back up to $16 million in grants from the Inflation Reduction Act to reduce air pollution and monitor and improve indoor air quality in schools. This provision would disproportionately affect children and schools in low-income, disadvantaged, and tribal communities who routinely report higher instances of asthma, lead poisoning, and obesity. 

Children are uniquely vulnerable to pollutants as they breathe more air in relation to their body weight than adults. A mountain of evidence suggests that properly managing indoor air quality in schools leads to better academic performance and attendance, protects children from airborne illnesses like COVID-19, and makes school buildings last longer while saving money. Estimates show that 57 million people attend or work in schools across the country and the reconciliation bill would put the air they breathe at risk. 

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