The House Committee on Energy and Commerce marked up its contribution to President Donald Trump’s One Big Beautiful Bill Tuesday, a significant accomplishment for Chairman Brett Guthrie (R-KY) and Speaker Mike Johnson (R-LA). While the legislation does contain some welcome reforms to Medicaid and delivered on its $880 billion deficit reduction target, the reforms agreed to fall far short of what could have been accomplished. As the legislation advances first to the House floor and then to the Senate, the current version must be the floor and no further dwindling should be tolerated.
According to the Congressional Budget Office, $715 billion of the deficit savings identified by the Committee comes from reductions in healthcare spending, almost all from the Medicaid program. This does not mean spending on Medicaid will decline; quite the opposite. The CBO projects that Medicaid will continue to rise year-over-year for every year covered in its analysis. It is just that with the House Republican reforms, spending would grow at a slower rate than before, a rate that had previously surpassed both Medicare and Social Security spending growth.
The big ticket Medicaid reform items driving the spending slowdown include freezing the provider tax loophole used by many states to boost Medicaid spending beyond established federal matching rates and forbidding any new provider taxes from coming on line; rolling back Biden administration regulations that prevented states from ensuring Medicaid recipients qualified for the program; blocking Medicaid benefits for recipients who cannot prove they are citizens; work requirements for able-bodied adults; $35 co-payments for recipients whose income is above the federal poverty line; and reductions in matching payments, from 90% to 80%, to states that provide healthcare for illegal immigrants.
Ideally, House Republicans would have made more fundamental reforms to Medicaid, such as eliminating the provider tax loophole and equalizing the federal matching rates of able-bodied adults to a rate higher than more vulnerable people, such as expecting mothers, children, and the disabled, receive. Under current law, states receive 90% of the dollars spent on able-bodied adults from the federal government, but are reimbursed only 50% for what they spend on mothers and children. Deficit hawks were looking for something in between, which would have protected women and children better while forcing states to spend less on able-bodied adults.
Democrats will point to a CBO score showing that the Medicaid reforms will reduce the number of people with health insurance by 8.6 million, but it is hogwash. When Republicans repealed the Affordable Care Act individual mandate in 2017, the CBO estimated it would cause 13 million people to lose health insurance. They were wrong. Today, the number of people with health insurance has risen from 295 million in 2017 to 315 million in 2024. The percentage of the population with health insurance has also increased from 91.2% in 2017 to 92.3% in 2024.
Unfortunately, there are many Republicans, most prominently Sen. Josh Hawley (R-MO), who want to see Medicaid spending grow faster, not slower. These Republicans apparently approve of states such as California providing Medicaid benefits to illegal immigrants on the dime of hard-working Missouri taxpayers, and they have no interest in making sure that those using the program qualify to do so.
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Republicans need to find ways to make life more affordable. That doesn’t mean putting the fraud-ridden Medicaid program on autopilot just because Democrats attack efforts to defund healthcare for illegal immigrants.
If Trump’s One Big Beautiful Bill is to boost the economy as Republicans want it to, it must include real spending reductions. The House Committee on Energy and Commerce accomplishes that, but only barely. Senate Republicans must not mess it up.
This article was originally published at www.washingtonexaminer.com
