A big, beautiful balancing act: 6 policy pressures

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JANUARY 6, 2026—Higher education and health care employers had a tumultuous year of executive orders, research funding cuts, and major tax legislation.

The fire hose of directives that dominated headlines in 2025 will drive 2026 priorities, according to the 300 nonprofit institutions surveyed by TIAA in September 2025. The One Big Beautiful Bill Act (OBBBA) in particular will have implications for staffing and revenues, while the provisions of other saving and retirement account directives should come into sharper focus this year. The following are among them:

1. Research grants. More than 4,000 federal grants were terminated in 2025, and $6 billion in research grants was frozen, affecting institutions in every state.¹ “We’ll be more cautious about approving new grants,” says one benefits leader.

2. Endowment tax. Endowment tax changes weren’t as sweeping as feared in the OBBBA. Only private colleges and universities with more than 3,000 students and an endowment larger than $500,000 per student will be subject to the excise tax, says Chris Spence, TIAA’s managing director for government relations.

3. Health care. OBBBA’s Medicaid cuts may leave 10 million more Americans uninsured.² “The reduction in reimbursements and loss of coverage will drive up uninsured visits that will never be paid,” one health care leader predicts. “The double-whammy of reduced revenue plus increased resource use as patients delay [until care is more costly] will push us to expand telehealth and inter-organizational partnerships,” says another.

4. Immigration. New H-1B visa petitions must be accompanied by an additional $100,000 fee. “Increased H-1B costs are creating a significant concern for international faculty recruitment,” says a state university benefits leader. In higher ed, one possible solution is pressing qualified staff into teaching classes in addition to their day jobs, until new faculty members can be onboarded. However, a 17% drop in first-year international students this past fall might mitigate the strain on teaching staff.³

5. Student loan eligibility changes. OBBBA could pose significant challenges for colleges and universities seeking to provide federal student aid. According to Aaron Smith, cofounder of Savi, which helps simplify student loan management, “Ending Grad PLUS loans in 2026 will likely create financing gaps for many students. Some may not go forward, or may choose private student loans because they won’t get enough federal aid,” particularly for graduate programs like a master’s degree in nursing or education.

6. Trump accounts. Introduced in OBBBA, these savings accounts for children are expected in summer 2026. Half of nonprofit leaders expect high employee interest.⁴ “We want to give employees more benefits without adding a big cost,” says an HR director.

Next up ... more lifetime income in DC plans?

While a “SECURE Act” 3.0 is not expected in 2026, discussions are under way on Capitol Hill about future legislation that could encourage more employers to adopt in-plan annuities—expanding on provisions in the first two SECURE Acts. Employers also should expect fresh guidance in 2026 from the Department of Labor around adding alternative investments to defined contribution plan menus, which could include lifetime income. Says Spence: “Regulatory actions could result in lifetime income being available to more Americans.”