SNAP and Medicaid Will Change Dramatically in October: What to Know - Newsweek

Millions of Americans who rely on government safety net programs could soon see major changes as new rules from President Donald Trump's sweeping budget law take effect next month.

The changes affect both the Supplemental Nutrition Assistance Program (SNAP) and Medicaid, the nation's health insurance program for low-income Americans.

While experts say the reforms could improve accountability and reduce federal spending, they’re also likely to increase hardship for vulnerable households while shifting billions of dollars in costs to states.

“The changes beginning this fall represent one of the more significant shifts in the financial relationship between Washington, the states, and Americans who rely on safety net programs,” Alex Beene, financial literacy instructor at the University of Tennessee at Martin, told Newsweek.

SNAP serves more than 40 million people each month, while Medicaid provides health coverage to tens of millions of low-income Americans and people with disabilities.

Beginning October 1, several new rules outlined in the One Big Beautiful Bill Act will take effect, creating new financial pressures for states and new eligibility requirements for many beneficiaries.

Starting October 1, the federal government's share of SNAP administrative costs will fall from 50 percent to 25 percent, meaning states will now be responsible for 75 percent of the costs of running the program.

The change was mandated by the One Big Beautiful Bill and is being implemented by the U.S. Department of Agriculture. According to USDA's proposed rule, the reduction in the federal reimbursement rate takes effect in fiscal year 2027, which begins October 1, 2026.

The administrative expenses affected include costs to pay caseworkers as well as fraud prevention efforts and even the call centers and tech platforms used to process benefits.

State officials have warned that the shift could force difficult budget decisions. While the law does not directly reduce benefits, states facing higher costs may respond by reducing their admin staff, which could slow enrollment processing.

Beginning in October 2027, certain states will also be required for the first time to contribute toward the cost of SNAP benefits themselves if their payment error rates exceed federal thresholds.

Historically, SNAP benefits have been funded entirely by the federal government.

October 1 will also bring major changes to Medicaid eligibility for many lawful non-citizens.

As a result, many groups that have traditionally been eligible for federally funded Medicaid coverage, including refugee and trafficking survivors, may lose access to federally funded coverage beginning October 1 unless their state provides alternative coverage using state funds.

However, emergency Medicaid coverage will still be available, and states may continue certain coverage options for eligible children and pregnant individuals under existing federal law.

Another major Medicaid change is on the horizon due to the One Big Beautiful Bill.

Under the law, certain able-bodied adults between ages 19 and 64 will soon be required to complete at least 80 hours per month of approved activities. This may include employment, job training, education or community service, but it will be necessary in order to maintain Medicaid eligibility.

The work requirements are scheduled to take effect after the October eligibility changes in January 2027, but the exact timing may vary depending on federal guidance and how states decide to implement the new rules.

The new requirements are intended to increase workforce participation and while preserving Medicaid for the most vulnerable populations.

“This rule helps Americans build skills and independence through work, education, job training, or community service, creating new opportunities for themselves and their families,” CMS Administrator Mehmet Oz said in a statement.

However, because the new policy could amount to lost benefits for Americans, many are concerned about worse health outcomes and higher debt levels for those who are already struggling.

“Supporters see these policies as a way to promote work and shift more responsibility to states, while critics worry the savings will come partly from people losing benefits because of administrative barriers rather than because of their improving financial circumstances,” Beene said.

Feeding America has described the One Big Beautiful Bill Act as one of the largest reductions to SNAP in decades, and the organization warned that higher state costs could strain budgets and inevitably reduce access to food assistance.

“The passage of the budget reconciliation bill is a significant setback for people and communities facing barriers to accessing the food and resources they need to thrive,” Claire Babineaux-Fontenot, Feeding America chief executive officer, said in a statement last year.

“At a time when food insecurity is rising nationwide, this legislation threatens to worsen the crisis, taking away access to food and health care from millions of people, including children, seniors, veterans and people with disabilities.”

The SNAP administrative cost changes and Medicaid immigrant eligibility restrictions are scheduled to take effect on October 1.

"These changes are happening because Republicans who passed the legislation argue that work requirements will encourage employment, reduce improper enrollment, and ensure Medicaid resources are directed toward eligible beneficiaries" Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek.

However, he added that "many affected beneficiaries already work" and additional reporting requirements could cause eligible people to lose coverage because of "administrative hurdles rather than their employment status."

Newsweek’s reporters and editors used Martyn, our AI assistant, to produce this story. Learn more about Martyn here. Contact Newsweek editors on this story: Edward T. Cummins