GOP budget plans would rip health care away from millions
House Republican plans to slash $880 billion from the federal budget would lead to millions of Americans getting booted from their health insurance, according to a nonpartisan analysis released Wednesday.
Democrats asked the Congressional Budget Office, a nonpartisan agency that analyzes the impacts of legislation, to review changes that House Republicans are debating making to Medicaid in order to finance President Donald Trump’s “One Big Beautiful Bill,” which would extend his 2017 tax cuts for the rich and fund his evil immigration plans.
The CBO’s report shows that the varying Republican plans would lead as many as 8.6 million low-income Americans to lose their Medicaid coverage and either have to pay for coverage or go without insurance.
In analyzing five different Republican proposals to cut Medicaid spending, the CBO found that all of them would lead to many, many Americans losing their Medicaid coverage.
“Medicaid cuts will result in the federal government paying more and a sicker society overall. Republicans don’t care as long it means a windfall for billionaires like Elon Musk,” New Jersey’s Frank Pallone, the top Democrat of the House Energy and Commerce Committee who requested the CBO analysis, said in a Wednesday post on X.
The most destructive plan that Republicans are debating is ending a tax loophole 49 states use to get more federal funding for Medicaid expenditures.
The New York Times explained how this tax loophole works:
In its simplest form, the tax maneuver works like this: When a Medicaid patient goes to the hospital, the federal government and state usually share the costs. The ratio varies from one state to another, depending on how poor the state is, but the federal government often pays around 60 percent of the bill.
States that use provider taxes to get more money usually start by paying the hospitals more. If the federal government is paying 60 percent and the state 40 percent, when a state bumps a payment to $1,030 from $1,000, the federal government chips in $618 instead of $600.
If Republicans end this loophole, it would get Republicans much of their desired $880 billion in federal savings, but 8.6 million people would lose their Medicaid coverage, and 3.9 million people would simply go without health insurance altogether, the CBO said.
Next up, the CBO looked at a GOP proposal to cap how much Medicaid pays states for each enrollee.
The Hill explained how those per-capita caps would work:
A per-beneficiary cap would fundamentally change Medicaid from an open-ended entitlement to one with strict limits on federal spending. Congress would set a fixed amount per beneficiary for each state to receive, and states would be responsible for all remaining costs.
The CBO found that if Republicans capped spending for all Medicaid enrollees, it would cause as many as 5.8 million people to be kicked off Medicaid, with 2.9 million people becoming uninsured.
The CBO also looked at Republicans’ plan to lower the federal medical assistance percentage each state receives. Lowering FMAP rates would negatively impact Republican-controlled states the most, as many of those states receive the highest FMAP rates. Republican-controlled states make up nine of the top 10 states with the highest FMAP percentages, according to KFF, a health news outlet.
If Republicans reduce FMAP rates, 5.5 million people would lose their Medicaid coverage, and 2.4 million would become uninsured, according to the CBO.
Ultimately, cutting Medicaid to finance tax cuts that primarily benefit the wealthy is politically toxic. Polls show voters like Medicaid and don’t want Republicans to use cuts to the program to fund Trump’s tax plans.
Vulnerable Republican lawmakers seem to understand this, with many all but begging House GOP leadership not to make them vote to cut the program.
House Speaker Mike Johnson allegedly ruled out two of those destructive Medicaid cut plans—the FMAP reductions and per-capita spending caps—Punchbowl News reported.
However, Republican Rep. Don Bacon of Nebraska doesn’t seem to believe that, telling The Wall Street Journal that he’s been pressured to vote for those cuts.
“Here’s the tactic they’ve been using: ‘Don’t worry about the Senate. They’ll fix it.’ And now we’re getting ready to take our third vote on this,” Bacon, who represents a district that Democrat Kamala Harris won last year, told the outlet. “We feel like we’re being pushed up to the edge of the cliff here.”
Meanwhile, Democrats, who are in the minority in both chambers of Congress and cannot by themselves vote down whatever proposal Republicans settle on, are using the CBO report to warn voters about what would happen if Republicans make these Medicaid changes.
“This is exactly what we have been ringing the alarm about. Republicans may claim they aren’t cutting Medicaid, but their actions speak louder than words,” Sen. Tammy Baldwin, Democrat of Wisconsin, wrote in a post on X of the CBO findings. “That’s why I’ll keep fighting their attempts to slash it and rip away care from American families.”
And Democratic Rep. Alexandria Ocasio-Cortez of New York had a more blunt assessment of the CBO report.
“Told ya,” she wrote in a post on X.