Major Medicaid and SNAP reductions imperil services for over two million Michigan residents.

LANSING, Mich. — Michigan leaders sounded the alarm July 7 on the sweeping consequences of the federal “One Big Beautiful Bill” (OBBB), warning that deep cuts to Medicaid, SNAP, mental-health care and public schools could dramatically undermine public services statewide. At a town hall led by Rep. Sharon MacDonell (D?Troy), lawmakers, health-care executives and educators outlined an unfolding crisis that may require significant state intervention.

One Big Beautiful Bill cuts drain millions from Michigan safety nets

The OBBB cuts more than $1 trillion from Medicaid and $186 billion from SNAP over the next decade—stripping roughly $2 billion annually from Michigan’s budget. With 2.4 million Michiganders on Medicaid and 1.5 million receiving food aid, local officials say the state will have no choice but to eliminate services or raise taxes.

Rep. Natalie Price (D?Berkley) warned: “These federal cuts will have a devastating impact on our communities. We should be investing in the services that people need, not cutting their lifelines” .

Healthcare sector warns of cascading impacts on rural hospitals

Brian Peters, CEO of the Michigan Health & Hospital Association, said cuts could slash GDP by $3.57?billion by 2029 and cost 41,500 jobs, including ripple effects in rural healthcare . He added rural providers could face closure or reduced services due to trimmed Medicaid reimbursements.

A recent Princeton University analysis forecasts 3–18% losses in Medicaid funding nationwide—amounting to billions in Michigan—and warns many states could call special legislative sessions to plug budget holes.

Mental?health services, education also on precarious ground

Robert Sheehan, CEO of the Community Mental Health Association of Michigan, said Medicaid funds over 90% of public mental-health revenues. The cuts place 300,000 residents with complex conditions at risk .

MaryBeth Fitzpatrick, retired superintendent from Royal Oak Schools, cautioned that the cuts threaten programs serving students statewide: “When funds are provided then arbitrarily revoked… it hurts our students” .

Expert analysis underscores national and local peril

National analysis by KFF estimates that Medicaid funding could plummet by 6–21% across states, putting millions at risk. The Congressional Budget Office also projects 10.9?million Americans may lose coverage, with school?age children especially exposed.

Michigan analysis from the Commonwealth Fund mirrors state findings: the cuts could reduce Michigan GDP by about $3.6?billion and eliminate upward of 33,000 direct and indirect jobs.

Michigan’s political leaders weigh in

Governor Gretchen Whitmer condemned the cuts as favoring the wealthy while undermining essential services. She highlighted risks of $900?million in annual benefits lost and predicted widespread economic harm.

What lies ahead

Facing an OBBB-imposed budget hole, Michigan may need to consider tax hikes or reallocation of limited state funds to fill gaps. Officials and advocacy groups are urging immediate action in both Lansing and Washington.

Broader context and related coverage

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