On July 4, President Trump signed into law a massive package of tax cuts and spending reductions, following approval in the Senate and the House earlier in the week. The One Big Beautiful Bill Act (H.R.1)opens in new window was enacted despite widespread concerns about its unprecedented cuts to federal health, social safety net programs, and climate change policies, as well as its addition of more than $3 trillion to the national debt.
Between cuts to Medicaid and the rollback of expanded Affordable Care Act subsidies, according to most estimates, tens of millions of Americans will lose health care coverage over the next decade. Additionally, the legislation cuts federal support for higher education by an estimated $300 billion, most of which would fall on support for graduate and professional education, limiting access to these degrees. Specifically, the bill substantially reduces the ability of graduate and professional students to borrow federal student loans, which are one of the only means of federal financial support for graduate study. Given that Medicaid is the largest federal payer for behavioral health services combined with the reliance of many doctoral psychology students on federal financial aid, this bill is likely to have substantial impacts on the future of the psychology workforce and access to behavioral health care.
APA Services spent many months in partnership with psychologists across the country advocating against this legislation, including through direct lobbying, leading coalition efforts, and engaging the voice of psychology. Since February, psychologists and psychology professionals sent more than 90,000 messages to Congress urging rejection of cuts to Medicaid, higher education, and federal food assistance. Although damaging, the legislation’s cuts could have been worse, as even more fundamental changes to Medicaid were being considered and the initial House version of the bill made steeper cuts to federal support for higher education. In addition to the aforementioned changes, provisions were added that seek to mitigate the effects on Medicaid recipients with mental health and substance use disorder services. A provision banning state regulation of AI, which APA strongly opposed, was also removed. While the bill, as passed, remains highly concerning, together we were able to mitigate some of the damage. Our collective advocacy made a difference.
Attention will now shift to the states, many of which are likely to face major budget shortfalls with the loss of federal support. The largest single policy change impacting Medicaid is the mandate that all states require individuals to prove they are engaged in work or other community-related activities as a condition of maintaining coverage. Although the bill provides an exemption from these requirements for individuals who are medically frail, including individuals with a disabling mental disorder or a substance use disorder, requiring these individuals to satisfactorily document their status to get and keep coverage will discourage enrollment. The voice of psychology will once again be critical in the states as these difficult funding decisions will be made in the coming months.
Throughout this entire process, APA Services worked on dual tracks, also advocating on fiscal year 2026 appropriations. For the coming fiscal year, Congress is considering hundreds of billions of dollars in proposed cuts to a variety of programs and agencies of importance to psychology, including those that fund psychological research, expand access to behavioral health services, and educate and train the psychology workforce.
“We recognize there is advocate fatigue. Yet, with the continued strong partnership of psychologists lifting up the critical constituent voice coupled with direct lobbying efforts, APA Services will continue our advocacy to protect psychology, psychologists, and the communities they serve,” said Katherine McGuire, APA’s chief advocacy officer. “We thank the thousands of psychologists who joined in advocating against cuts to Medicaid, higher education, and other critical federal programs in the budget reconciliation bill, and look forward to your future engagement.”
For more information, contact Scott Barstow and Kenneth Polishchuk.