On July 4, 2025, President Trump signed a bill into law that includes the most significant changes to several major social service programs since their inception. Effects of these changes will cascade throughout communities across the country, undoing decades of progress toward more healthy and equitable futures for children and youth. This bill will leave millions of children without access to health insurance and nutrition, shift the landscape of higher education financial aid, and hamstring states’ abilities to finance gaps left in the wake of cuts, while providing substantial tax benefits for the wealthiest Americans. In the face of this, strategic public financing for states and localities will be more important than ever before. In this blog, we highlight how specific provisions of the bill will affect children and youth, and present a call to action for communities committed to equitable and sustainable funding strategies for kids.

Federal Reconciliation Process

Congress drafted this legislation after the White House released its “skinny budget,” which proposed extreme cuts across federal agencies. Congressional rules for this type of bill limited changes to discretionary spending, leaving many programs that keep children fed, healthy, and in school untouched. However, these remain targets for future legislation—meaning these current cuts could be just the beginning.

This graphic shows the timeline of the bill’s passage, starting with the passage of the first version by the House in May.

Timeline of bill passing May 16 to July 4, 2025.Below, we summarize several major child and youth-affecting provisions and describe some of the largest and most consequential spending cuts for children and youth ages 0-24 and their families. We have also produced a more extensive explainer on How Cuts to Medicaid and SNAP Affect Children and Youth.

The bill contains major tax provisions, which we do not expand on here. For specific insights on the bill’s tax provisions, check out the Tax Policy Center.

Provisions on Major Child and Youth Funding Streams

The bill is estimated to cut federal spending by $4.4 trillion over the next 10 years, primarily through cuts to Medicaid and the Supplemental Nutrition Assistance Program.

Medicaid

This bill includes the largest cuts to Medicaid in the program’s history, terminating coverage for millions of Americans, largely by forcing new bureaucratic burdens on individuals and states. The provisions most impactful to children and youth include the following:

  • Terminating coverage for young adults without dependent children (ages 19-24) who do not report a minimum of 80 monthly hours of work, school, or community engagement.
  • Expanding this same requirement to include parents with children 14 and older with no exemptions for full-time caregivers. Many teenagers and their families who fail to meet this requirement will lose Medicaid coverage and will also be locked out of private insurance tax credits.
  • Requiring all beneficiaries to reapply every six months and limiting coverage of noncitizens to green card holders only.

Altogether, these provisions amount to $930 billion in cuts over 10 years, eliminating coverage for 17 million people. The bill also prevents states from raising revenue to fill this gap by capping Medicaid provider taxes and restricting the use of state-directed payments. Work requirements begin in 2026, with reduced federal Medicaid funding due to provider tax caps starting in 2028. American Indians and Alaska Natives are exempt from the work requirement and the requirement for beneficiaries to re-apply more frequently.

Supplemental Nutrition Assistance Program (SNAP)

The bill also cuts $295 billion over 10 years from the Supplemental Nutrition Assistance Program (SNAP), which provides monthly food payments to 42 million people, 40% of whom are children. Like Medicaid, it imposes heavy new bureaucratic requirements on individuals while shifting costs and administrative burdens to states. The bill does the following:

  • Requires all SNAP beneficiaries ages 18 – 64 to work 20 hours weekly or lose SNAP benefits after three months, becoming ineligible for SNAP for three years.
  • Applies the work requirement to parents of children age 14 and older with no caregiver exemptions, increasing food insecurity for young parents and grandparents raising their grandchildren;
  • Removes work requirement exemptions for youth aging out of foster care and those experiencing homelessness.
  • Limits increases in benefits that are designed to keep up with inflation and the cost of a healthy diet;
  • Requires states to pay for up to 15% of food costs (currently 0%) and 50% of administrative costs (currently 25%).
  • Restricts benefits for noncitizen groups to green card holders only and ends nutrition education benefits.

An estimated 3.3 million families with children will lose an average of $70 in SNAP benefits every month, or $840 annually. SNAP work requirements will begin potentially in 2025, phasing in fully by the end of 2026, with state funding changes starting in 2028. American Indians and Alaska Natives are also exempt from the SNAP work requirement.

Higher Education

There are several provisions in the bill affecting higher education financial aid that will begin taking effect in in 2026:

  • Higher education programs will become ineligible to receive student loan funding if they cannot prove that their graduates meet certain income thresholds. This will put many higher education institutions in dire financial straits, and force them to reduce the diversity of their offerings to students.
  • Two lending programs, one for graduate students, and one for parents, will cap borrowing amounts, preventing some students from enrolling altogether and forcing others to take out more expensive private loans.
  • The bill also delays implementation of Biden-era regulations providing loan relief to students defrauded by their institutions or whose institutions closed before they could finish their programs;
  • One positive provision expands Pell grant eligibility for accredited short-term programs. This change will expand workforce development opportunities for young people.

Call to Action

These changes to the public funding landscape are daunting. While federal leaders have chosen to prioritize tax reductions for the wealthy over investments in programs that demonstrably improve and save children’s lives, the fight for equitable funding continues at every level. Here are actions you can take to make a difference:

We also recommend turning to the following action and advocacy-oriented organizations: