Big Beautiful Bill Act 2025 - How It Changes Medicaid and Special Needs Planning in Florida

Randy Narkir, Esq.
Aug 8
5 min read

Updated: Sep 30

A single lit candle glowing in darkness, symbolizing remembrance and grief after a parent’s passing in Florida.

Introduction

What would happen if a single new law threatened your child’s health coverage while opening new ways to secure their future?

President Trump’s recently passed Big Beautiful Bill Act 2025 does exactly that – reshaping Medicaid, ABLE accounts, and how families plan for their loved ones with disabilities.

These changes are not just headlines – they represent real shifts that can impact your child’s benefits, daily care options, housing opportunities, and your family’s financial peace of mind. Whether your loved one relies on Medicaid or you use ABLE accounts for future planning, these updates demand attention and proactive action.

In this clear breakdown, we explain exactly what has changed, why it matters for Florida families like yours, and what your next steps should be to stay protected and empowered.

1. Stricter Medicaid Eligibility: What’s Changing

Who Must Meet the 80-Hour Rule?

The law introduces mandatory work requirements for Medicaid recipients in expansion states, demanding at least 80 hours per month of work, volunteering, or education. While Florida hasn’t expanded Medicaid yet, any future expansion will meet these requirements.

More Paperwork, More Risk

Beyond work rules, the bill increases eligibility checks every 6 months, doubling the paperwork burden and increasing the risk of losing coverage if a deadline is missed.

How the Home Equity Cap Affects Florida Families

Another change affects seniors or disabled adults planning for long-term care. The new $1 million nationwide home equity cap means that if your family home’s equity exceeds this amount, the excess will count against Medicaid eligibility. With Florida’s rising property values, more families could be affected in the coming years.

Real-Life Example: Daniel’s Story

Daniel, a 28-year-old with mild intellectual disability, works part-time at Publix, clocking in about 50 hours a month. Under the new Big Beautiful Bill Act rules, his family worries because the law requires at least 80 hours per month to maintain Medicaid coverage. They’re now exploring options to increase his work hours or prepare medical exemption documentation to ensure he does not lose his health benefits, which cover critical therapies and medications.

For Daniel’s family, proactive planning with a special needs attorney is now not just helpful; it’s essential to keep his therapies and health stable.

What You Should Do Now (Medicaid Changes)

Review your child’s work or volunteer hours if they’re on Medicaid
Set calendar reminders for twice-yearly renewal deadlines
Evaluate your family home equity if planning long-term care

Failing to adapt to these changes could result in unexpected loss of benefits, leaving your child or aging parent vulnerable. Our firm can guide you through proactive planning to maintain Medicaid eligibility and protect your family home.

2. ABLE Account Updates: New Opportunities

While Medicaid rules tightened, ABLE accounts gained powerful new advantages:

Higher Contribution Limits The new law permanently raises ABLE account contribution limits for working disabled individuals. This means your child can save more of their earned income up to the federal poverty line in addition to the annual family contribution without risking SSI or Medicaid benefits. This small but critical increase can help build their long-term independence.

Saver’s Tax Credit Eligibility

ABLE contributions now qualify for the federal Saver’s Tax Credit, providing immediate tax savings of up to $2,000 depending on income. This not only encourages savings but reduces your family’s tax burden each year.

Tax-Free 529 Rollovers

Families can roll over unused 529 college funds into ABLE accounts without tax penalties. This allows money initially set aside for college to support disability-related expenses such as therapies, housing, transportation, and education alternatives, keeping funds protected and purposeful.

Real-Life Example: Marcus’s Progress

Marcus, a 25-year-old with autism, works at a local grocery store and previously worried about losing his benefits if his earnings exceeded limits. Now, under the Big Beautiful Bill Act 2025, Marcus can contribute his wages above the standard family contribution limit into his ABLE account permanently, while his parents continue to add their own contributions. This ensures he builds long-term financial security without risking Medicaid or SSI eligibility.

For Marcus and his parents, these new ABLE rules mean freedom to build his future without fear of losing vital health or disability benefits.

Real-Life Example: Emma’s 529 Rollover

The Nguyen family had saved diligently in a 529 college plan for their daughter, Emma, who has Down syndrome. As she grew, they realized college might not be part of her path. Thanks to the Big Beautiful Bill Act, they can now roll over her 529 funds into an ABLE account without any tax penalties, using the money for therapies, transportation, and supported housing.

For Emma’s family, this rollover unlocks funds for the life she wants – not the one others expected.

What You Should Do Now (ABLE Changes)

Explore increasing contributions if your child works
Claim the Saver’s Tax Credit for ABLE contributions this year
Rollover unused 529 funds if college is no longer in your child’s plan

We help families develop coordinated strategies combining ABLE accounts and trusts to provide lifelong care security for their loved ones.

FAQs

Does Florida Medicaid require work hours right now?

No. Florida hasn’t expanded Medicaid yet, but any future expansion must meet the 80-hour federal requirement.

If Florida expands Medicaid, when will the work requirements begin?

States must implement the 80-hour work rule by January 2027, or earlier upon expansion.

Can I roll over my child’s 529 plan into an ABLE account without penalties?

Yes. The rollover is tax-free up to the annual ABLE contribution limit.

Who qualifies for the higher ABLE contribution limits?

Working individuals with disabilities can contribute their own earnings beyond the standard family annual limit.

How does the Saver’s Tax Credit benefit Florida families?

Contributions to ABLE accounts reduce your federal tax liability, allowing Florida families to save more efficiently.

What is Florida’s current home equity limit for Medicaid long-term care eligibility?

Florida currently follows federal guidelines, and under the new law, the nationwide cap is $1 million.

Will the 80-hour work rule apply to caregivers in Florida?

The Senate version requires parents of children over 14 to meet work requirements, but final state rules will determine exemptions.

Can ABLE accounts be used for housing in Florida?

Yes. Funds can be used for rent, mortgage, utilities, and other housing-related expenses.

How often will Medicaid eligibility be checked under the new law?

At application and at least every six months.

Are ABLE account earnings taxable in Florida?

No. Florida does not tax ABLE account earnings, and federal law exempts qualified withdrawals from income tax.

Final Takeaway

The Big Beautiful Bill Act 2025 creates both challenges and opportunities for special needs families. Stricter Medicaid rules demand vigilance to protect benefits, while expanded ABLE account options empower families to save more confidently.

It also signals that future policy shifts are always possible, making proactive legal and financial planning an essential act of love and responsibility.

Now is the time to review your Special Needs Plan to ensure your child’s future remains protected, no matter what changes come next.