The “One Big Beautiful Bill Act” (OBBBA) has garnered attention primarily for its significant modifications to the U.S. tax laws, including making permanent the individual income tax brackets established by the 2017 Tax Cuts and Jobs Act.
Apart from tax-related changes, the bill contains provisions unrelated to taxation that will impact various aspects of daily life for ordinary Americans, including travel, women’s healthcare, immigration, and welfare.
One notable aspect of the OBBBA signed into law on July 4th by President Trump is its allocation of $125 billion to the Department of Transportation for long-overdue reforms to the national air traffic control system.
Within this budget, $47.5 billion is designated for upgrading copper cable telecommunications infrastructure to fiber optics, $30 billion for radar system replacements, $5 billion for enhancing safety technology to prevent runway incidents, and $1 billion for advanced training for air traffic controllers.
Transportation Secretary Sean Duffy stated during a cabinet meeting on July 8th that this funding represents a “massive new beginning to rebuild our nation’s air traffic control.” He emphasized the need for additional funds to elevate the U.S. aviation industry to a global leading position.
Duffy has pointed out the outdated technology and infrastructure of the Federal Aviation Administration, still relying on equipment such as computer floppy disks, aging copper wires, and outdated telephone consoles.
Although fully addressing these issues requires more funding, the budget allocation from this bill will help reduce and prevent various flight delays like those that caused disruptions earlier this year at Newark Liberty International Airport in New Jersey.
The OBBBA allocates $150 billion towards border security and immigration enforcement, aligning with some of President Trump’s core promises during his 2024 re-election campaign.
Approximately $800 billion of the budget will be directed towards domestic immigration enforcement in the United States.
The single largest allocation related to immigration is $465 billion for the construction of the border wall along the U.S.-Mexico border.
The majority of the remaining funds are allocated to Immigration and Customs Enforcement (ICE), the agency primarily responsible for executing President Trump’s large-scale deportation of illegal immigrants.
This funding includes $45 billion for detention appropriations through September 2029, representing a 365% increase compared to ICE’s previous annual detention funding of $34 billion. The bill also allocates $14.4 billion for transportation and repatriation operations, marking a 500% annual increase.
Additionally, the federal government will allocate $13.5 billion to assist state and local governments in their deportation efforts.
The OBBBA introduces significant adjustments to federal education policies.
Firstly, the bill lowers the eligibility requirements for high-income students and full scholarship recipients to receive Pell Grants. Pell Grants, worth approximately $7,000 annually, have long provided financial support for higher education for Americans.
The bill also introduces two federal student loan repayment plans, including a traditional repayment plan and an income-based repayment plan. These adjustments indicate the Republican Party’s efforts to repeal the controversial “Saving on a Valuable Education” (SAVE) plan proposed by the previous administration.
Furthermore, the bill will subject donations received by U.S. universities to taxation, with tax rates ranging from 1.4%, 4%, to 8%, depending on the institutions’ wealth.
Noteworthy changes include adjustments to Medicaid funding, expected to lead to millions of beneficiaries losing access to the program, potentially affecting rural hospitals.
To reduce Medicaid spending, the bill mandates that able-bodied adults must work 80 hours per month to qualify for benefits. This change is set to take effect no later than December 2026.
Additionally, in states expanding the Medicaid program under the Affordable Care Act, the bill will decrease the “provider tax” — the tax states levy on hospitals and physicians to fund Medicaid — from 6% to 3.5%. This change will not apply to the 10 states that have not expanded Medicaid, and it will take effect in 2028.
To address concerns about these adjustments impacting rural hospitals, the bill will allocate $50 billion over five years to support these healthcare facilities, alleviating public worries.
Estimates vary on the number of individuals who will lose insurance coverage due to the Medicaid program adjustments. The Congressional Budget Office predicts that millions of Americans could lose healthcare coverage nationwide.
The OBBBA introduces new requirements for Supplemental Nutrition Assistance Program (SNAP) beneficiaries.
Moreover, the bill imposes stricter work requirements on SNAP recipients. Currently, able-bodied recipients aged 18-54 must engage in 80 hours of volunteer work, employment, job searching, or educational activities each month. The bill extends this requirement from ages 18-54 to 18-64.
In terms of funding the SNAP program, states will bear a greater burden, potentially resulting in reduced or eliminated benefits for recipients, depending on each state’s circumstances.
The OBBBA also includes a pilot program called “Trump Accounts,” a federal trust account funded with $90 billion, involving military housing, childcare, and additional benefits for members of the Armed Forces and their families.
This initiative entails increasing the basic housing subsidy by $29 billion and extending a $5.9 billion temporary housing allowance to aid military personnel in relocation.
Additionally, the program allocates more funds to the military healthcare system.
The expanded welfare programs aim to incentivize more individuals, particularly those with spouses and children, to join the U.S. military.
The OBBBA introduces a new chapter reinstating spectrum authority for the Federal Communications Commission (FCC). Spectrum authority refers to the power the FCC holds to auction specific radio frequencies to private entities.
The FCC’s spectrum authority expired in 2023, as the Biden administration’s directives were limited, leading to a deadlock in Congress.
The bill reauthorizes the program, expected to generate $85 billion in federal revenue over the next decade, allowing for the expansion of 5G and 6G mobile networks and enabling rural areas to access wireless communications crucial during natural disasters.
The OBBBA terminates federal Medicaid funding for family planning for a year. Planned Parenthood, the largest abortion service provider in the U.S., has long been a target for conservatives seeking to end federal funding for family planning services.
Notably, the new legislation does not explicitly mention Planned Parenthood but refers to nonprofit abortion providers that received over $800,000 in federal Medicaid reimbursements during the 2023 fiscal year.
A federal judge has put a hold on this legislative aspect, awaiting further litigation.
The bill also makes significant modifications to the Affordable Care Act (ACA). The ACA Marketplace provides discounted health insurance for low-income Americans.
Firstly, the bill requires marketplace customers to re-enroll annually, akin to how some employees need to reaffirm their selected employer-sponsored health insurance plans each year. During this re-enrollment process, customers must also re-verify their income.
The bill also shortens the open enrollment period. While the Biden administration had previously extended the open enrollment period, this bill restores the window to the original November 1st to December 15th timeframe.
Other provisions of the law include excluding gender reassignment treatments from coverage, limiting marketplace tax credits to citizens and some legal residents, and requiring policyholders to pay premiums on time before re-enrolling for the next year.
These changes will be phased in, with some eligibility-related adjustments taking effect as early as December 2025.
The OBBBA includes a $90 billion expansion of welfare programs, covering military housing, childcare, and other benefits for armed forces members and their families.
These measures aim to increase basic housing subsidies by $29 billion and introduce a $5.9 billion temporary housing subsidy to aid military personnel in relocation.
Furthermore, the program allocates additional funding for the military healthcare system.
The expanded welfare programs seek to incentivize more individuals, particularly those with spouses and children, to join the U.S. military.
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