It has been just over a year since the One Big Beautiful Bill Act (OBBBA) was signed into law, and its impacts are rippling through grocery aisles, doctors’ offices, and classrooms across the country.

For current and prospective students in higher education, particularly those with low incomes, OBBBA contained massive policy changes that are reducing food assistance, healthcare coverage, and access to financial aid. These cuts are ultimately leaving students without the vital support systems they often rely on to stay enrolled. At a time when millions of college students experience persistent food insecurity, housing insecurity, and/or homelessness, policies like these that erode student basic needs are only worsening an already-fragile reality for today’s higher education students.

Worse, this same law that reduced access to the Supplemental Nutrition Assistance Program (SNAP) and Medicaid also substantially increases states’ share of the cost of administering these programs. The result is a perfect storm for students: fewer resources to meet their basic needs, fewer financial supports to help them afford college, and looming budget cuts that could send the cost of attendance skyrocketing.

The passage of OBBBA has fundamentally reshaped two of the nation’s largest safety net programs: SNAP and Medicaid.

Since the bill was passed in July 2025, 5 million people have lost their SNAP benefits, and participation has plummeted 11% nationwide—the largest decline in SNAP coverage in 30 years. Cuts to SNAP under OBBBA also included revoking eligibility for lawfully present immigrants who previously qualified after a waiting period, expanding the work-requirement age ceiling from 54 to 64, narrowing the caregiver exemption to parents of kids under 14, and eliminating exemptions for veterans, homeless individuals, and former foster youth.

These harms will continue to mount as state budgets become increasingly squeezed, or if the economy falters further. On top of this, other cuts to SNAP, such as freezing the Thrifty Food Plan (TFP) formula and capping future adjustments to general inflation—instead of actual food costs—will strip the buying power of SNAP benefits every year and ultimately reduce households’ overall access to nutritious foods.

Meanwhile, the Center on Budget and Policy Priorities (CBPP) estimates that 15 million people are projected to lose health insurance over the next 10 years thanks in large part to OBBBA’s new requirement that adult Medicaid recipients prove and document that they are working (or engaging in another qualifying activity) 80 hours a month—often dubbed a “paperwork requirement.” These paperwork requirements, combined with a shift from annual to twice-yearly eligibility checks, increase the likelihood of eligible people falling through administrative cracks. 

Millions of students access insurance through Medicaid, and they will soon be forced to navigate an increasingly overwhelming healthcare bureaucracy. While new paperwork requirements do count at least half-time enrollment in a postsecondary or technical education program as a qualifying activity, at least in theory, students will now be required to repeatedly verify their eligibility every six months, in addition to academic, work, and family obligations, leaving many vulnerable students to be kicked off the rolls despite technically remaining eligible.

Separately, the expiration of enhanced Affordable Care Act (ACA) marketplace subsidies is projected to more than double premiums for many enrollees and push millions more off marketplace coverage entirely. Hundreds of hospitals and clinics are at risk of closing; healthcare jobs are being cut; healthcare premiums are climbing as tax credits have expired; and providers are absorbing the loss of Medicaid revenue. Concurrently, state Medicaid budgets will be reduced by $679 billion over the next decade.

These cuts add another layer to a public benefits system that is already notoriously difficult for students to access. The overly complex SNAP student rules often lock out students enrolled half-time or more, requiring them to meet one of a series of convoluted “exemptions” to gain access, usually by working 20 hours per week alongside a full-time course load. The SNAP rules are so notoriously complex that 2 in 3 likely-eligible students do not report receiving benefits. OBBBA’s SNAP provisions did not change these onerous rules, but rather layered on new time limits and eligibility restrictions for students who are enrolled less-than-half-time (and thus subject to the standard SNAP eligibility criteria) and reduced future benefit levels for SNAP recipients.

While millions of college students who are directly enrolled in SNAP and Medicaid will feel these cuts and new red tape firsthand, most students will feel the aftershocks indirectly through a cascade of budget decisions resulting from the law’s punitive new state financial obligations.

Starting in FY2027, states will be required to cover 75% of SNAP administrative costs, up from 50% today. Then, the following year, states will also be responsible for paying a share of SNAP’s actual food benefit costs for the first time in the program’s history—between 0 and 15%, depending on each state's payment error rate. Lawmakers have an opportunity to reverse—or at least delay by several years—these state cost-sharing provisions through the current Farm Bill process, but thus far, Congress has yet to reach an agreement that would give states much-needed fiscal breathing room.

Medicaid brings a separate squeeze: OBBBA restricts the “provider taxes” many states use to fund Medicaid payments to hospitals, stripping away a major source of provider revenue, adding to the $679 billion reduction in state Medicaid funds noted above.

These shifts mean states will soon be building budgets that must absorb massive new payment obligations imposed by the federal government, in addition to the cuts they’ve already made, with higher education especially vulnerable. With states shouldering more of the cost of running public benefit programs, other social services within the safety net will be reduced or eliminated entirely, state taxes will increase, aid will decline, tuition will balloon, local economies will shrink, and healthcare costs will rise alongside rates of food insecurity. Already, state educational appropriations per student declined from 2024 to 2025, even before any of the SNAP or Medicaid cost-sharing provisions went into effect.

With Medicaid reductions phasing in gradually, the deepest cuts and coverage losses are projected through the mid-2030s. And states that managed to avert the worst cuts this cycle will face the same pressures, if not worse, next budget cycle, as temporary reserves run out and cost-sharing obligations kick in. 

It is also important to note that enrollment declines take years to surface. Because financial instability drives students to delay enrollment, stop out, or never enroll at all, the true scale of the damage may very well be invisible until years after this generation of students has already been affected.

And if Congress fails to address the devastating impacts of last year’s benefit and eligibility cuts in the upcoming Farm Bill, the worst is yet to come. 

As tuition increases fail to keep pace with rising costs and shrinking state appropriations, hiring freezes, furloughs, and staff layoffs are becoming the norm rather than the exception across public university systems.

And proposed federal cuts elsewhere compound these effects, adding to the chaos. For example, the Trump Administration’s FY2026 budget request called for eliminating grant programs that address basic needs and campus childcare, and delayed funding for crucial college access programs, TRIO and GEAR UP, which serve nearly 800,000 first-generation, low-income, and rural students annually. Last October, before Congress rejected the Administration’s tactics and restored full funding, roughly 120 TRIO programs were cut anyway, resulting in the elimination of jobs at colleges who host these programs and losses in access to tutoring and financial aid support for more than 43,600 students. Although funding was later reinstated, the future of these programs, and the counselors who run them, remains uncertain.

While Congress has thus far rejected the worst cuts in this year’s appropriations process, institutions have faced ongoing funding attacks and upheaval from an Administration intent on reducing the federal role in higher education. 

If this weren’t enough, OBBBA upended the way that millions of students will finance their degree program. Beginning July 1, 2026, OBBBA imposed new federal borrowing limits that now make paying for college riskier for the students who already have the fewest alternatives. Part-time students are now subject to onerous new reductions that reduce their ability to cover food, housing, transportation, and more. The Graduate PLUS loan program was eliminated entirely for new borrowers. Parent PLUS loans are now capped at $20,000 annually, up to $65,000 per dependent, while graduate borrowing is capped at $100,000 lifetime (down from $138,500). Additionally, a new $257,500 aggregate lifetime cap applies across all federal student loans. 

These caps are likely to cause budgetary chaos at institutions while simultaneously pushing students who lack other financing options—often the same lower-income students who are impacted by SNAP and Medicaid cuts—toward predatory private loans with fewer protections, or out of graduate and professional programs altogether.

In essence, the students absorbing the brunt of these overlapping cuts are, unsurprisingly, the same students the safety net was built to protect, including: first-generation students, who make up the nearly 800,000 young people TRIO serves annually; students who were already relying on campus food pantries, emergency aid funds, and basic needs centers; and Pell Grant recipients and students of color, who already face disproportionately higher rates of food insecurity and homelessness. These supports are the very infrastructure now being defunded.

The strain is already visible in one of the few tools that reliably keeps a struggling student enrolled: emergency aid. A new Hope Center analysis found that the share of students receiving emergency aid fell from 44% in Fall 2021, when the pandemic-era Higher Education Emergency Relief Fund (HEERF) was still flowing, to just 4% by Fall 2025, despite more campuses than ever having an emergency aid program. Money that used to reach almost half of struggling students now reaches almost none of them.

Student basic needs stability is a prerequisite for college completion, and OBBBA is systemically undermining it from multiple directions at once, from state budgets down to a student’s grocery bill. 

Basic needs are not a side issue in higher education. They’re the foundation that everything else is built upon. When federal policy chips away at that foundation—through SNAP cuts, Medicaid reductions, and shrinking federal loan access—enrollment, retention, and graduation all become collateral damage.

One year in, the damage from OBBBA is beginning to curtail opportunities and derail futures for millions of students and their families. Colleges are fighting to keep their food pantries, emergency aid programs, and basic needs centers open, but they're patching holes in a federal safety net that OBBBA is pulling apart faster than any campus can mend. The people who fall through are the ones the net was built to catch: first-generation students, Pell recipients, parenting students, and students choosing between rent, dinner, or finishing their degree.

OBBBA was a policy choice. And unless Congress reverses course soon, it's a choice students will be paying for well into the next decade.

Natalie Zaffiro is a Bill Emerson National Hunger Fellow at The Hope Center for Student Basic Needs through August 2026.