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The House of Representatives passed the tax megabill dubbed the “One Big Beautiful Bill Act” on Thursday afternoon with a vote of 218 to 214, ushering in the biggest changes to federal healthcare programs in more than a decade.

Legislators passed the bill after all-night negotiations, in which House Republicans secured votes among several conservatives who had remained hesitant about some of the bill’s steep cuts to Medicaid and the Affordable Care Act (ACA).

President Donald Trump is expected to sign the bill into law on Friday.

The bill cuts about $1.1 trillion in funding to those federal healthcare programs as part of the Trump administration’s goal to eliminate “waste, fraud and abuse.” It represents the biggest change to U.S. healthcare since the passage of the ACA in 2010 and will likely impact the health coverage of millions of Americans.

Several provisions are more directly related to drug manufacturers — including some that are considered policy wins to the pharma industry, according to Jim Potter, executive director of the Coalition for Healthcare Communication.

“I think [in general], the megabill has been favorable to the pharmaceutical industry,” Potter said. But he added that the bill will have a dramatic impact on healthcare access as a whole, particularly for state Medicaid programs and lower-income patients.

Here’s what pharma marketers need to know about what was included in the One Big Beautiful Bill Act:

• Medicaid/ACA cuts. The biggest healthcare takeaway is the bill’s measure to cut healthcare spending by about $1 trillion, with some 11.5 million Americans expected to lose coverage.
• The absence of ‘Most Favored Nation’ policy. President Trump’s drug pricing proposal was not included in the bill.
• The Orphan Cures Act. The bill included a measure that would exempt certain rare disease drugs from Medicare price negotiations – another win for the pharma industry that could see some $5 billion in savings as a result.
• Tax breaks for R&D costs. The bill extends tax breaks for corporations investing in certain business activities, including new machinery or drug research and development (R&D).
• PBM reform dropped from the bill. While drug manufacturers and bipartisan lawmakers have sought to push PBM reform for years, it was dropped from the Senate version and not included in the bill.
• Other provisions not in the bill included proposals that would eliminate or limit tax deductibility for advertising, in particular for drug manufacturers. Another provision that could have impacted healthcare marketers, the proposed moratorium on state AI laws, was excluded.

Here’s a more detailed breakdown of the healthcare and pharma-related provisions.

Medicaid changes

Some of the bill’s biggest changes are to Medicaid, the federal and state health insurance program that covers low-income Americans and Americans with disabilities. Medicaid spending is expected to be cut by $1 trillion over the course of a decade, according to the Congressional Budget Office (CBO).

Most notably, the bill includes Medicaid work requirements that would start in 2026. Adults aged 19 to 64 who do not have a disability will have to prove they work, volunteer or attend school in order to be eligible for Medicaid.

This would be a massive change to the current status of Medicaid, which does not impose work requirements on beneficiaries to qualify.

The bill also includes a measure that would lower the tax states can place on hospitals and medical providers in order to fund their state Medicaid programs. Opponents of the bill argue that this could have a negative impact on rural hospitals and could cause many to shutter.

Physicians, hospitals and patient advocacy organizations criticized the passage of the bill, arguing it would result in less accessible care for patients who rely on Medicaid. The American Medical Association (AMA) asserted that the bill “moves us in the wrong direction.”

“Today is a sad and unnecessarily harmful day for patients and healthcare across the country, and its impact will reverberate for years,” Bobby Mukkamala, president of the AMA, said in a statement.

The Orphan Cures Act

A smaller provision included in the final bill that weakens the Medicare price negotiation program was considered a win for pharma manufacturers.

The measure, dubbed the Orphan Cures Act, includes expanded exemptions for certain rare disease drugs from the Medicare price negotiation program, which negotiates lower drug costs for certain Part D drugs.

Currently, rare disease drugs – dubbed orphan drugs – are exempt from Medicare price negotiations if they treat one disease. The Orphan Cures Act expands that exemption to orphan drugs that treat multiple rare diseases.

This is a policy that pharmaceutical lobbying groups have been rallying around for some time, arguing that it will help incentivize rare disease development.

It’s the biggest change to the Medicare price negotiation program since it was passed under the Biden administration in 2022, and would amount to about $5 billion in savings for the pharma industry, CBO estimates.

Patient advocacy group Patients For Affordable Drugs Now criticized the provision, however, arguing that Congress handed Big Pharma a multi-billion dollar “taxpayer giveaway” that ignores the desire of many Americans to see lower drug costs.

“This unnecessary carveout keeps prices high on drugs that should be negotiated, weakening Medicare negotiation before it even begins to deliver savings,” Merith Basey, executive director of the group, said in a statement.

This is a developing story that will be updated with a more detailed breakdown of the healthcare and pharma-related provisions.